Live from Disrupt Berlin 2018 Day 2


. >>LADIES AND GENTLEMEN, PLEASE TAKE YOUR SEATS. THE PROGRAM WILL BEGIN IN FIVE MINUTES.>>LADIES AND GENTLEMEN, PLEASE WELCOME BACK TO THE STAGE TECH CRUNCH EDITOR IN CHIEF MATTHEW PANZORINO.>>GOOD MORNING. GOOD MORNING. EXCELLENT. WELCOME TO DAY TWO OF DISRUPT BERLIN. WE HAVE AN EXCELLENT SHOW FOR YOU TODAY. WE HAVE JULIE HANSON AND MARCUS WIT FROM BABBLE THAT ARE HERE TO TALK. THE ENTIRE TEAM FROM EXCEL IS HERE TO TALK, WHICH IS UNIQUE. TRUE CALLER WILL BE ON THE STAGE TO TALK TO US, AND ALSO N-26, WHICH IS A FORMER STARTUP BATTLEFIELD COMPANY. THEY’RE NOW WORTH HUNDREDS OF MILLIONS OF DOLLARS IN REPORTED VALUATION. WE’LL SEE HOW THEY GOT IF THIS STAGE TO WHERE THEY ARE NOW. SPEAKING OF THE BATTLEFIELD, WE HAVE THE BATTLEFIELD FINALS COMING UP. LEGACY, IMAGO AI, POLATIA AND SPIKE WILL BE TRYING TO WIN THE STARFIELD BATTLEFIELD AND GO ON TO PERHAPS SUCCESS LIKE A COMPANY LIKE IN 26. LET’S GO AHEAD AND LAUNCH THE SHOW. THANK YOU SO MUCH FOR BEING HERE. GOOD MORNING.>>LADIES AND GENTLEMEN, PLEASE WELCOME TO THE STAGE TECH CRUNCH EDITOR AND DISRUPT EMCEE JORDAN CROOK.>>GOOD MORNING. RIGHT? I APPRECIATE IT. ESPECIALLY YOU THREE, AND I SAW YOU TWO. VERY WELL DONE. PARTY PEOPLE. WHO WENT TO THE PARTY LAST NIGHT OF THE, LIKE, 16 PEOPLE HERE RIGHT NOW? COOL. AWESOME. IT WAS FUN TIMES. LOST MY VOICE A LITTLE BIT, SO JUST BRINGING IT DOWN A NOTCH. OKAY. A COUPLE HOUSEKEEPING NOTES BEFORE WE KICK THE SHOW OFF. FIRST THING, OTTER AI IS STILL ALIVE AND WELL IN THE HOUSE. THEY’RE GOING TO HAVE ON THE LEFT SIDE RIGHT THERE, YOU CAN ACTUALLY SEE IT TRANSCRIBING REAL-TIME MY VOICE. THERE’S ALSO AN APP WHICH I FORGOT TO MENTION YESTERDAY, SO GO AHEAD AND CHECK OUT THAT. OR YOU CAN DISH OUT OTTER AI/DISRUPT BERLIN TO GET FULL TRANSCRIPTION TO THE SHOW. WHAT ELSE DO WE HAVE ON THE DOCKET HERE? QUICK REMINDER, IN ABOUT 25 MINUTES ONE OF OUR MODERATORS, JOHN SHEIBER IS GOING TO BE DOING OUR INTERVIEW WITH BRIN KENNEDY, AND HE IS BEING LAZY AND WANTS TO KNOW IF YOU HAVE QUESTIONS. YOU CAN TWEET TO HIM @JAYSHEIBER IF YOU WANT TO CONTRIBUTE A QUESTION TO HIS PANEL. AND THE SAME GOES FOR ANY OTHER PANEL THROUGHOUT THE AGENDA TODAY. IF YOU HAVE A QUESTION THAT YOU ARE REALLY, REALLY ITCHING TO KNOW THE ANSWER TO, YOU CAN TWEET TO ME, AND I’LL PASS THAT ALONG TO THE MODERATOR. OKAY. LET’S DO IT. LET’S DO DAY ONE. I’M THRILLED TO WELCOME ALL THE WAY FROM THE U.S. ONE OF THE LEADING AMBASSADORS HERE — DID I SAY DAY ONE? COOL. KILLING IT. ONE OF THE MOST CREATIVE MINDS IN AUGMENTED REALITY, PLEASE WELCOME TO THE STAGE FROM GENERAL CATALYST NIKO BONATSOS, AND FROM 6 D.AI ADAM CALDWAY. HERE WE GO. ENTHUSIASM.>>ALL RIGHT. ♪♪>>HELLO. GENTLEMEN. YEAH, WHY NOT?>>DON’T WANT TO LEAVE YOU OUT. THANKS FOR JOINING US. I WANT TO START OFF WITH A DOWNER. YOU GUYS BOTH MADE A BIG BET ON AR AND VR OR PROBABLY XR TO JUST SIMPLIFY IT. MADE A BIG BET ON AR AND VR. WE’RE NOT AT THE WORST CASE SCENARIO, BUT WE’RE NOWHERE NEAR THE BEST EITHER. WHERE ARE WE IN THAT SORT OF SCENARIO SCENARIO?>>MUCH, MUCH BETTER THAN WE WERE TEN YEARS AGO WHEN I FIRST GOT INTO THIS SPACE WHERE I THINK WE’RE COMING OUT OF, I THINK, MY THIRD HYPE CYCLE IN AROUND AR. FROM MY POINT OF VIEW THE FACT THAT APPLE, GOOGLE, YOU KNOW, MICROSOFT HAVE MADE SUCH BIG COMMITMENTS TO THE SPACE IS VERY REASSURING OVER THE LONG-TERM. SIMILAR TO, YOU KNOW, THE SMARTPHONE INDUSTRY, YOU KNOW, TEN YEARS AGO, WE’RE JUST GRADUALLY SEEING, LIKE, ALL THE DIFFERENT PIECES COME TOGETHER, AND AS THOSE PIECES MATURE, WE’LL EVENTUALLY, YOU KNOW, IN THE NEXT FEE YOURS SEE IT COALESCE IN THE iPHONE MOMENT. I’M STILL REALLY POSITIVE. I DON’T THINK THAT ANYONE SHOULD BE LOOKING FOR SOME SORT OF BIG CONSUMER HIT PRODUCT YET, BUT IN VERTICALS, YOU KNOW, IN ENTERPRISE, IN SOME OF THE CORE TECH AND TOOL SPACES, THERE’S BIG OPPORTUNITIES THERE.>>NOW IT’S MUCH, MUCH, MUCH BETTER THAN WHAT IT WAS A YEAR AGO. I THINK WHAT WE GOT WRONG IS PROBABLY THE BELIEF THAT A TON MORE IN THE DEVELOPERS WOULD HAVE COME INTO THE SPACE AND WOULD BY NOW WE WOULD HAVE IT AT ANOTHER TEN POKEMON-TYPE CONSUMER MASSIVE HIT APPLICATIONS. THIS HAS NOT HAPPENED YET. TO BE HONEST, YOU KNOW, I GOT THAT WRONG. I THOUGHT WE WOULD HAVE A FEW MORE GAMES BECAUSE NORMALLY GAMES ALWAYS LEAD THE ADOPTION OF NEW TECHNOLOGY AT PLATFORMS, BUT THE ENTERPRISE SPACE IS VERY, VERY EXCITING. YOU KNOW, 6-D HAS MONITORED THIS TRANSITION. IT’S ALSO CLEAR IN ORDER TO HAVE THE iPHONE MOMENT, WE PROBABLY NEED TO HAVE MUCH BETTER HARDWARE CAPABILITIES, AND EVERYBODY IS PRAYING TO SEE WHAT APPLE AND THE OTHER BIG COMPANIES ARE GOING TO DO, AND THEN IT’S REASSURING TO KNOW THAT THEY’RE INVESTING REALLY BIG DOLLARS INTO THE SPACE.>>YEAH.>>BUT, MATT, THIS IS — YOUR COMPANY IS ENTIRELY A SOFTWARE PLAY ESSENTIALLY, AND COULD YOU MAYBE EXPLAIN FOR THE BENEFIT OF OUR AUDIENCE WHAT IT IS THAT YOU DO AND I THINK WE HAVE A VIDEO ALSO TO SHOW.>>YEAH. SO WE’RE A COMPANY THAT IS SOLVING THE HARDEST TECHNOLOGY PROBLEMS FOR, YOU KNOW, CAMERA-BASED DEVICES TO BE ABLE TO UNDERSTAND THE REAL WORLD, AND ONE OF THE BIG CHALLENGES FOR DEVELOPERS IS OFTEN THEIR APPS JUST AREN’T REALLY BELIEVABLY THERE. YOU KNOW, IF SOMEONE WALKS IN FRONT OF IT OR YOU WANT YOUR CONAT THE PARTICULAR TIME TO MAYBE BOUNCE OFF A WALL OR INTERACT WITH THE WORLD IN SOME WAY, THAT HASN’T BEEN POSSIBLE. IT’S A DIFFICULT, TECHNICAL PROBLEM TO SOLVE. WE ARE, I GUESS, GIVING REGULAR CAMERAS THE ABILITY TO BEHAVE AS IF THEY’RE LIKE A DEPTH CAMERA, AND INTERPRET AND CAPTURE THAT WORLD IN 3-D AND SERVE THAT UP TO AR DEVELOPERS. THAT’S STEP ONE, AND THAT WILL JUST — THOSE ARE CAPABILITIES WE’LL EXPAND OVER TIME, AND IT’S ALL SOFTWARE-DRIVEN. WE’RE NOT DEPENDENT ON ANY PARTICULAR BIT OF HARDWARE TO ENABLE THOSE.>>RIGHT. I BELIEVE WE HAVE A VIDEO IF WE CAN CUE UP THE VIDEO, AND MATT, MAYBE YOU CAN TALK US THROUGH WHAT WE SEE THERE. THERE IT IS.>>OH, THERE IT IS. IF ANYONE HAS EVER SEEN A HOLLOW LENS OR MAGIC LEAP, ONE OF THE COOL THINGS IS THE ABILITY FOR THEM TO DO MIXED REALITY, WHICH IS THAT CONTENT CAN BE INCLUDED BEHIND THINGS. IT CAN BOUNCE OFF STUFF, AND THAT IS ALWAYS NEEDED SPECIALIZED HARDWARE. SOME SORT OF DEPTH CAMERA. THOSE CAMERAS, YOU KNOW, ARE A CHALLENGE TO GET DISTRIBUTED AT SCALE AND FLAGSHIP PHONES. WE HAVE SOME SOFTWARE THAT’S COME OUT OF OUR RESEARCH LAB AT OXFORD UNIVERSITY THAT LETS A REGULAR CAMERA BE ABLE TO BUILD THESE MODELS OVER THE WORLD IN, LIKE, REALLY LARGE SCALE, INDOOR OR OUTDOORS, IN 3-D, AND THEN YOU CAN START BUILDING THESE KIND OF RICHER, MORE ENGAGING APPS THAT, YOU KNOW, HAVE THAT AWARENESS OF THE WORLD. WE’RE SEEING HERE, LIKE, THE RABBITS HIDING BEHIND THINGS. CONTENT IS BOUNCING OFF STUFF. YOUR DEPTH CAMERAS COULD NEVER WORK OUTDOORS BEFORE. IT’S AN ENTIRELY NEW — IT’S ALMOST LIKE A NEW CLASS OF APP, AND YOU GO FROM BEING ABLE TO TARGET A FEW THOUSAND, YOU KNOW, HEADSETS TO THE HUNDREDS OF MILLIONS OF PHONES WITH THE SAME TYPE OF EXPERIENCE.>>WITHOUT FRYING YOUR PHONE TOO. IT’S REALLY, REALLY COOL. IT’S COMMODITY HARDWARE AND SOFTWARE, AND NOT LIKE, YOU KNOW, HAVING A BOMB THAT’S GOING TO EXPLODE IN YOUR HANDS.>>YES, SETS THE PHONE ON FIRE. WE DON’T DO THAT.>>HOW HAVE WE ADVANCED IN THAT WAY? THE PHONE CAMERAS AREN’T THAT MUCH DIFFERENT THAN THEY WERE A FEW YEARS AGO. THEY’RE BETTER, AND WE HAVE BETTER CHIPS, BUT WHAT HAS MADE IT POSSIBLE TO DO THIS THAT WASN’T — THAT WE DIDN’T HAVE A FEW YEARS AGO?>>COMBINATION OF BETTER — DIFFERENT RESEARCH IN COMPUTER VISION. APPLE AND GOOGLE ARE DOING ARQ AND AR CORE AND DOING THE SENSOR FUSION BETWEEN THE LOWEST LAYER OF THE SOFTWARE AND HARDWARE. YOU THEN HAVE SOFTWARE AND EVERYTHING ABOVE THAT SOFTWARE, AND THAT’S BEING DRIVEN BY COMBINATION OF JUST REGULAR, LIKE, 3-D MAPS AND 3-D — BUT NEWER RESEARCH AND NEWER NETWORKS HAS MEANT THAT A LOT OF THAT UNDERSTANDING OF THE WORLD AND COMBINED WITH THE OLDER APPROACHES IS GETTING REALLY GOOD RESULTS ON DEVICES.>>BUT, AS YOU MENTIONED, YOU THOUGHT THAT GAMING WOULD LEAD — IN A WAY IT HAS. POKEMON IS VERY POPULAR, BUT GAMING AND MEDIA ISN’T NECESSARILY THE WAY THAT THIS TECHNOLOGY IS GOING TO BECOME MAINSTREAM. WHAT ARE THE INDUSTRIES AND THE APPLICATIONS THAT PEOPLE MAY NOT HAVE THOUGHT OF?>>WE ARE SEEING A LOT OF INTEREST FOR APPLICATIONS ON THE ENTERPRISE FRONT. WE’RE SEEING AM KEGS AROUND TRAINING OR AROUND IMAGEING AND TECHNICAL TEAMS, AROUND COLLABORATION. WE’RE HAVING PEOPLE ALL OVER SPECIFIC ALGORITHMS TO DO TASKS THAT THEY’VE NEVER DONE IN THEIR LIFE. WE’RE SEEING APPLICATIONS IN PHARMA AND OIL AND GAS WHERE YOU THINK OF THE DETAILED STUFF THAT YOU COULDN’T DO BEFORE BECAUSE YOU CAN WEAR SOME HARDWARE, FOLLOW EVERYTHING ON YOUR SCREEN, AND YOU CAN USE YOUR HANDS TO DO WHATEVER YOU’RE SUPPOSED TO BE DOING. THAT’S REALLY, REALLY EXCITING. THESE ARE SOME OF THE APPLICATIONS, YOU KNOW, THAT — EARLY DAYS, I HAVEN’T SEEN A LOT OF, YOU KNOW, PRODUCTS IN THE PACE. THESE ARE MORE LIKE MORE OF A JOB WORKING WITH AN OFFICER OF A COMPANY THAT IS MUCH MORE FORWARD-THINKING, AND THEY WANT TO COME UP WITH A REALLY EARLY — NOW WE’RE SEEING SOME EARLY STAGE TECH START-UPS THAT ARE TRYING TO FIX THESE PROBLEMS. THE GOOD NEWS IS THAT IT’S INVESTED IN TRYING TO DO SOME OF THE PROBLEMS AND WHOEVER FIGURES OUT HOW TO GET DOLLARS FROM THE MANAGERS, FROM THE BIGGER COMPANIES, THESE ARE REAL ENTERPRISE BUSINESSES TO BE BUILT. I’M VERY EXCITED ABOUT THAT.>>YEAH.>>BUT THEY ARE STILL ESSENTIALLY AT THIS POINT STILL TERK DEMOS. NO ONE IS USING IT AT SCALE, RIGHT? HOW DO WE GET FROM HERE TO THERE?>>RIGHT. I DISAGREE WITH THAT IN THE SENSE OF ALL OF THE CUSTOMERS WE’RE ENGAGING WITH THAT THE TRIALS ARE SORT OF DONE AND COMPLETED. THEY DEEPLY UNDERSTAND THE PROBLEM, THEY UNDERSTAND THE VALUE OF THE PROBLEM, AND THE SORT OF SIZE OF THE OPPORTUNITIES THAT WE’RE WORKING WITH IS LIKE TENS OF MILLIONS OF USERS, LIKE, PER CUSTOMER, AND THERE ARE MULTIPLE CUSTOMERS LIKE THAT. WE NEED TO DO A PROJECT AND SEE IF — THEY REALLY — THE BIGGER THE COMPANY IS AND THE MORE TIME THEY’VE HAD TRYING TO UNDERSTAND THESE PROBLEMS, THE EASIER OR THE QUICKER THEY SEE THE SOLUTION WE’VE GOT AND SORT OF MOVE TOWARDS, YOU KNOW, FIGURING OUT WHAT THE DEAL NEEDS TO BE. IT’S BEEN REALLY, LOOK — THE DEVELOPERS WANT TO BE BUILT, AND THE BIGGER PLATFORMS, THE BIGGER CUSTOMERS THEY KNOW WHAT THEY NEED.>>THE REALLY BIG COMPANIES, THEY KNOW WHAT THEY WOULD LIKE TO HAVE IN FRONT OF THEM. THEY DON’T KNOW HOW TO DO IT THEMSELVES. IT’S ALWAYS A QUESTION OF, YOU KNOW, BUY VERSUS BUILD. THE HARDEST THING, THOUGH, IN START-UP LAND IS TO FIND INDIVIDUALS THAT CAN ACTUALLY PRODUCTIZE WITH THEIR UNIQUE TECHNOLOGY WHATEVER THE BIG COMPANIES WANT TO BUILD. THEN HAVE A DEEP UNDERSTANDING OF WHAT THE INTEGRATIONS THAT ARE REQUIRED BECAUSE BIGGER COMPANIES, THEY USE A LOT OF DIFFERENT TYPES OF SOFTWARE. THEY HAVE THEIR DATA SOURCES IN MANY DIFFERENT TYPES OF DATABASES. HOW DO YOU COMBINE ALL THAT STUFF? IF YOU MANAGE TO DO IT AND GET ON THE OTHER SIDE, THE DEFENSIBILITY AND THE MODE ARE THE SAME. IT’S NOT DIFFERENT FROM BUILDING A TRADITIONAL ENTERPRISE FOR BUSINESS. IT’S NO DIFFERENT.>>WE’RE TALKING IN A LOT OF GENERAL TERMS ABOUT SOME LARGE COMPANIES HAVE THOUGHT OF SOME USES. WHAT IS A LARGE COMPANY THAT HAS — AND WHAT IS AN ACTUAL USE THAT THEY ARE LOOKING AT?>>NAME THREE OR FOUR.>>ONE IS — THERE’S MULTIPLE OF THESE, BUT SORT OF A TRANSPORTATION COMPANY THAT IS INVOLVED IN, YOU KNOW, SOME AUTONOMOUS VEHICLES, SOME RIDE-SHARING, YOUR MICRO-MOBILITY, AND THEY HAVE BIG PROBLEMS AROUND, YOU KNOW, HOW DOES THE RIDER GET FROM, LIKE, THE BAGGAGE CAROUSEL TO THE RIGHT PICKUP POINT, AND HOW DO THEY KNOW WHICH TOYOTA COROLLA IS THE RIGHT ONE TO GET INTO. AR CAN SOLVE THAT PROBLEM. VERY, VERY ACCURATE WAY-FINDING TO DIFFERENT POINTS. THAT’S A PROBLEM THAT THEY HAVE, THE USERS HAVE, ANYONE WHO HAS EVER USED ANY OF THOSE SERVICES HAS PROBABLY EXPERIENCED THAT PROBLEM AND THAT AR IS THE NO-BRAINER SOLUTION FOR IT. THERE’S THE BIG HARDWARE COMPANIES ARE STARTING TO FIGURE OUT HOW DO I SHOW OFF THE NEW CAPABILITIES OF THIS HARDWARE? HOW DO I MAKE MY DEVICES SPATIALLY AWARE, AND THAT COULD BE A PHONE, HEADSET, DRONE, VACUUM CLEANER, ROBOT, ANYTHING LIKE THAT. THEY ALL NEED THE SAME TECHNOLOGY THAT POWERS AR FOR THEIR DEVICES. THESE AREN’T LIKE IF NICHE VERTICAL DEVICES. THESE ARE THE FLAGSHIP PHONES THAT YOU’LL SEE ON STAGE.>>RIGHT.>>WE’RE SEEING BIG — POKEMON IS DEFINITELY PROVEN THAT IF YOU’VE GOT IP THAT IS A NATURAL FIT WITH THE REAL WORLD, YOU KNOW, LIKE WHAT POKEMON WAS, THEN AR CAN ENABLE SOME REALLY COMPELLING EXPERIENCES. WE HAVE, YOU KNOW, BIG — A NUMBER OF BIG GAME COMPANIES THAT ARE SORT OF TRYING TO WORK THROUGH NOW THE GAME MECHANICS. WE’VE SHOWN THAT THE TECHNOLOGY CAN WORK. THE USER EXPERIENCE IS THERE. IT’S MORE OF A QUESTION OF HOW DO WE DESIGN A GAME, AND LASTLY, THERE’S MEDIA COMPANIES THAT EVERYTHING FROM VIRTUAL YOUTUBERS IN JAPAN TO BIG THINK PARK OWNERS WHO ARE TRYING TO SAY, LOOK, HOW DO I LET MY CHARACTERS AND CONTENT STEP OUT OF THE SCREEN AND BE INTERACTIVE, SAYS AND ANY — THERE’S PROBABLY, YOU KNOW, FOUR CATE CATEGORIES, BUT WE’VE DPROEBL PROBABLY GOT TEN OR 12 OF THOSE TYPE OF DEALS THAT WE’RE WORKING ON, AND ANY ONE OF THEM WOULD JUST HAVE THAT HUGE SCALE ONCE THEY LAUNCH NEXT YEAR. IS THAT — >>YEAH.>>SPECIFIC.>>YEAH. ROBOT VACUUM CLEANERS ESSENTIALLY THE ANSWER.>>YEAH.>>BUT I’M INTRIGUED BY THE NEW DEVELOPMENTS, THE ENTIRELY NEW THINGS WHERE YOU ARE TALKING ABOUT, FOR EXAMPLE, A CAR BEING ABLE TO POSITION ITSELF USING THE SAME TECHNOLOGY STACK THAT PRODUCES AN AR EXPERIENCE, BUT THERE ARE ALSO ENTIRELY NEW EXPERIENCES, AND IF WE CAN CUE UP THE NEXT VIDEO, YOU BROUGHT THIS ENTIRELY NEW THING, WHICH I THINK IS EXTRAORDINARY, BUT ALSO A LITTLE SCARY. IF WE COULD SHOW THAT THE SECOND VIDEO, PLEASE.>>YEAH. THIS IS LIKE NO ONE HAS EVER SEEN THIS BEFORE. IT’S THE FIRST TIME WE’VE SHOWN IT IN PUBLIC. IT’S OUT OF OUR RESEARCH LAB, AND IT SHOWS RUNNING LIVE ON A PHONE — THIS ISN’T SOME RESEARCH VIDEO. THIS IS WE WALKED OUTSIDE OUR OFFICE AND HIT GO. THE ABILITY FOR THE FIRST TIME FOR PHONES TO BE ABLE TO, YOU KNOW, RECOGNIZE AND TRACK MOVING OBJECTS IN A SCENE, AND, YOU KNOW, WHAT DROVE US TO BUILD THAT IS LIKE DEVELOPERS SAY, LOOK, I CAN DO THIS AR IN MY LIVING ROOM, AND I CAN GET SOMETHING THAT SITS ON THE COUCH, BUT WHEN I GO OUTSIDE, THERE’S PEOPLE WANDERING AROUND, AND THERE ARE CARS. AS SOON AS SOMETHING LIKE THAT MOVED INTO THE FIELD OF VIEW OF THE CAMERA, IT BREAKS THE EXPERIENCE. YOU KNOW, AGAIN, OUT OF OUR TEAM TO SOLVE THIS PROBLEM PROBABLY A YEAR AHEAD OF WHERE THE REST OF THE WORLD IS AT, AND IT’S EXCITING. WE SHOW THIS TO ANYONE THAT KNOWS 3-D, THEY LITERALLY JUMP OUT OF THEIR CHAIR, BUT, YOU KNOW, AS YOU ALLUDED TO, IT OPENS UP ALL THESE POTENTIAL UNINTENDED CONSEQUENCES.>>NIGHTMARE SCENARIOS HOW I PUT IT. BLACK MIRROR TYPE STUFF. ALSO VERY EXCITING THINGS.>>YOU COULD, EXACTLY. SO WHE’RE WRESTLING WHAT MIGHT THIS BE USED FOR. SURE, IT’S GOING TO MAKE YOUR POKEMON GAME MORE FUN, BUT IT COULD LET A BLIND PERSON WALK DOWN THE STREET AND HAVE AWARENESS OF CARS AND PEOPLE AND THEY MAYBE DON’T NEED A CANE OR SOMETHING, BUT IT COULD ALSO LET YOU TAP AND LITERALLY HAVE PEOPLE, YOU KNOW, BE REMOVED FROM YOUR FIELD OF VIEW, AND YOU ONLY SEE THE TYPE OF PEOPLE THAT YOU WANT TO LOOK AT, WHICH IS, YOU KNOW, COULD BE — ESPECIALLY IN THE BROADER TECH INDUSTRY AS WE’RE SEEING SOME OF THE SOCIAL IMPACTS OF HOW THE STUFF CAN GO WRONG, EVEN WITH, YOU KNOW — EVEN IF YOU HAVE GOOD INTENTIONS, THESE SORT OF, YOU KNOW, BREAKTHROUGHS THAT WE’RE HAVING, ARE CAUSING US TO BE AWARE OF THE RESPONSIBILITY WE HAVE TO THINK A BIT MORE DEEPLY ABOUT HOW THIS MIGHT BE USED FOR THINGS WE DIDN’T EXPECT.>>THIS IS LIKE A GREAT OPPORTUNITY TO USE THIS NEW TECHNOLOGY TO DO WELL BY DOING GOOD. THE RESPONSIBILITY IS HERE FROM DAY ONE TO THINK ABOUT PRIVACY, THINK ABOUT, LIKE, ALL THE FAKE STUFF THAT WE CAN POWER, AND THE LIMIT, AND AS WE’RE CREATING THIS MASSIVE AUGMENTED REALITY, 3-D VERSION OF THE WORLD, LIKE, WHO IS GOING TO OWN IT, HOW WE’RE GOING SHARE ALL THIS WEALTH, HOW DO WE MAKE SURE THAT THERE’S GOING TO BE A WHOLE NEW ARCHI-SYSTEM THAT EVERYBODY CAN TAKE PART OF? IT’S VERY INTERESTING STUFF TO THINK ABOUT.>>WELL, THEY’RE VERY INTERESTING QUESTIONS, WHICH IS WHY THEY’RE ON THIS NOTE CARD. I ACTUALLY WAS CURIOUS, WHEN YOU ARE BUILDING — LET’S SAY I’M USING AN APP THAT IS USING YOUR STACK IN THE BACKGROUND, AND I’M USING IT TO PLAY AN AR GAME IN MY APARTMENT. I’M ESSENTIALLY BUILDING AND UPLOADING A DETAILED 3-D MODEL OF MY PRIVATE SPACE TO YOUR SERVERS OR WHOEVER IS HOSTING THE THING. HOW — IS THAT DATA CONSIDERED PERSONAL DATA, UNDER REGULATORS? HOW DO WE MAKE SURE THAT IT IS KEPT PRIVATE? WHAT ARE THE GUARANTEES YOU CAN GIVE TO YOUR USERS, OR IS THAT SOMEBODY ELSE’S RESPONSIBILITY?>>YEAH. I MEAN, THE SHORT ANSWER IS NOBODY KNOWS. IT’S — THERE’S NO SILVER BULLET. LIKE THIS IS THE ANSWER. THE PROBLEM AROUND, YOU KNOW, WHAT HAPPENS WITH THIS DATA THAT THE APPLICATION, YOU KNOW, LIKE CREATES OR DEROOIFZ, SOME OF IT IS PRETTY SIMPLE. LIKE WE KNOW WHEN IT’S OKAY TO PULL YOUR PHONE OUT AND TAKE A PHOTO. THERE’S A SOCIAL CONTRACT THAT WE HAVE WITH TECH THAT MOST OF US KIND OF UNDERSTAND, BUT THERE ARE PROBLEMS HERE THAT NO ONE REALLY KNOWS WHAT IS GOING TO BE, YOU KNOW, APPROPRIATE FOR HOW TO USE IT, AND THERE ARE SOME PRINCIPLES THAT WE HAVE ADOPTED, YOU KNOW, FOR OURSELVES BECAUSE WE REALIZE THAT I GUESS ONE OF THE THINGS THAT WE DO IS THAT NO PERSONAL IDENTIFYING INFORMATION EVER LEAVES THE PHONE, SO ALL OF OUR CONSTRUCTION OF THE 3-D MODELS AND ALL OF THAT IMAGE CAPTURE IS ALL DONE ON THE DEVICE. YOU DON’T NEED A NETWORK CONNECTION. IT’S THERE. ANYTHING THAT DOES LEAVE THE DEVICE IS COMPLETELY — CANNOT BE REVERSE-ENGINEERED INTO SOMETHING THAT’S HUMAN UNDERSTANDABLE, AND IT CAN’T BE IDENTIFIED TO A PARTICULAR LOCATION. EVEN IF WE GOT HACKED OR A GOVERNMENT AGENCY, YOU KNOW, GOT THE INFORMATION, THEY — FIRSTLY, THEY COULDN’T TELL THIS PARTICULAR FILE CORRESPONDS TO YOUR HOME, AND EVEN IF THEY COULD, IT WOULD JUST BE A BUNCH OF GRAY BLOBS THAT, YOU KNOW, VISIBLY COULDN’T BE TURNED BACK INTO ANYTHING. WE’RE TAKING IT REALLY SAERSLY FROM THAT POINT OF VIEW. THERE’S POTENTIALLY THINGS WE COULD DO LIKE CAPTURE A PHOTO REALISTIC MODEL AND WE DON’T. WE JUST HAVE SAID THAT’S A PROBLEM THAT WE NEED TO SPEND MORE TIME THINKING THROUGH, BUT IT’S GOING TO BE — I THINK EVEN IF WE DO EXACTLY WHAT WE THINK IS RIGHT, AND WE ASSUME THAT WE HAVE GOOD INTENTIONS, IT’S A BIG GRAY AREA IN LOTS OF WAYS, AND WE’RE GOING TO MAKE MISTAKES, AND WHEN THAT HAPPENS, YOU KNOW, NOT IF, BUT WHEN IT HAPPENS, ALL WE’RE GOING TO BE ABLE TO RELY ON IS OUR VALUES AS A COMPANY, AND THE TRUST THAT WE’VE BUILT WITH THE COMMUNITY BY SAYING THESE ARE OUR VALUES AND THEN ACTUALLY LIVING UP TO THEM AND SOME PEOPLE CAN TRUST US TO LIVE UP TO THOSE VALUES. THAT WHOLE DOMAIN OF START-UPS FIGURING OUT VALUES, COMMUNICATING VALUES, AND SORT OF LOOKING AT THIS SORT OF ABSTRACT AR, START-UPS AS AN INDUSTRY HAVE DONE A PRETTY BAD JOB, AND ION BIG COMPANIES, THERE WOULD ONLY BE A HANDFUL THAT YOU COULD SAY, LIKE, APPLE HAS BEEN PRETTY CLEAR ON THEIR VALUES. IF AR AND THIS EAMERICANING TECH DOMAIN, IT’S GOING TO BE ULTIMATELY THE CORE.>>WELL SAID, BY THE WAY. YOU’VE TAKEN THE OPPOSITE SIDE OF THIS. NIKO, YOU HAVE TALKED ABOUT IT IN THE PAST. INVESTING IN COMPANIES AND CONCEPTS THAT ARE ANNOYING OR PERHAPS COUNTER INTUITIVE WITH THE HOPE THAT IN A COUPLE OF YEARS THEY’LL BE NORMALIZED AND BROADENED OUT. ER. >>THERE WERE CONSUMER APPLICATIONS. SPAESHLG WHEN DISTRIBUTION IS SOLVED. IT’S OFTEN A QUESTION OF IMAGINATION. LOOCH THE STAFF IN THE BEGINNING LOOKS OR SOUNDS LIKE A TOY, AND WHEN YOU ARE LAUNCHING SOMETHING NEW, YOU WANT TO HAVE A TON OF WORD OF MOUTH MOMENTUM, SO WHAT IS THE KIND OF STUFF THAT HAS A LOT OF WORD OF MOUTH MOMENTUM? ANYTHING THAT’S PERCEIVED AS ANNOYING, STUPID, CONTROVERSIAL, BUT, OF COURSE, OVER TIME IT WOULD NOT BE PERCEIVED AS STUPID, ANNOYING, CONTROVERSIAL TO THE SAM VERY GROUP OF USERS. YOU NEED TO GRADUATE FROM A CERTAIN TYPE OF CONTROVERSY TO ANOTHER ONE FOR DIFFERENT TYPES OF USERS AND BECOME TRULY MAINSTREAM PRODUCT. OTHERWISE, IT’S GOING TO BE SOMETHING BASICALLY ENTERTAINING IN THE BEGINNING, BUT IT WILL BE SECURE OVER TIME. THE CONSUMER APPLICATION LEVEL, OF COURSE, THIS APPLIES TO ANY OF THIS NEW EMERGING TECHNOLOGIES. WHENEVER YOU SEE THE DIFFERENT AM KEGS THAT GET BUILT. THE INFRASTRUCTURE LEVEL, ENTERPRISE SOFTWARE FRONT, THIS INVESTMENT, THIS IS, UNFORTUNATELY, YOU KNOW, IT DOES NOT APPLY LIKE THAT. IT’S MORE ABOUT CAN WE FIND THE DOMAIN EXPERTS, PEOPLE LIKE MATT, THAT ARE GOING TO DO WELL BY DOING GOOD BECAUSE THERE ARE A TON OF DIFFERENT PERIMETERS TO THINK ABOUT HERE, WHO HAVE THE CREDIBILITY IN THE MARKET TO MAKE IT HAPPEN. IT’S MUCH MORE LIKE A TRADITIONAL ENTERPRISE INVESTING, AND WE’RE EXCITED, YOU KNOW, TO HAVE INVESTED IN MATT AND SEE HIM MAKE THE TRANSITION FROM BUILDING SOMETHING FOR INDY DEVELOPERS ON THE HEELS OF THE HYPE AROUND ARQ AND AR CORE TO A FULLY BLOWN ENTERPRISE SOLUTION THAT AS SOON AS WE HAVE IT LAUNCHED, IT’S GOING TO BE USED BY TENS IF NOT HUNDREDS OF MILLIONS OF END USERS, YOU KNOW, DEVICES. THIS HAS NOT BEEN AN EASY TRANSITION. THE COMPLEXITY OF THE PROBLEM CHANGED QUITE A BIT. BEFORE IT WAS MORE AROUND DEV TOOL FOR INDIVIDUAL DEVELOPERS, ENABLING THEM TO DO COOL STUFF. I HOPE THIS ONE DAY WORKS OUT. HASN’T HAPPENED YET. BUT AS SOON AS THE WORLD SEES WHAT IS POSSIBLE TO BUILD WITH THESE TECHNOLOGIES, SMART PEOPLE WILL PUT IN VERY MUCH THEIR BRAINS TO BUILD SOMETHING.>>I FEEL THAT CHINA IS ALREADY BUILDING A LOT OF THESE THINGS. THEY’RE AHEAD OF US IN SOME WAYS. A LOT OF WAYS. IN THE SECTOR. WHAT CAN WE LEARN FROM THEM, AND WHAT DO YOU THINK THEY’RE DOING RIGHT AND WRONG THAT YOU CAN TAKE LESSONS FROM?>>FOR AR, YES. I GUESS I CAN TALK TO AR. YEAH, THE WORLD, IT’S NOT LIKE EUROPE AND THE U.S. AND, YOU KNOW, SOUTH ASIA. IT’S REALLY THERE’S CHINA AND EVERYWHERE ELSE. ALTHOUGH I THINK, YOU KNOW, IN TERMS OF JUST LIKE PURE TECHNOLOGY AND PRODUCT CAPABILITIES OF THINGS, IT’S ROUGHLY EQUAL THE ADOPTION OF AR AND VR IN CHINA IS JUST A WHOLE OTHER SCALE. IT’S DEFINITELY SEEN AS, YOU KNOW, THAT — THE NEXT PLATFORM AFTER THE SMARTPHONE, AND NOT JUST, YOU KNOW, MANUFACTURERS, BUT REGIONAL GOVERNMENTS ARE SORT OF BUYING INTO THAT, AND SETTING UP, LIKE, WHOLE DISTRICTS AROUND AR AND VR. THE THINGS THAT IN THE U.S., LIKE, NOVELTY KIND OF AR APPS OR COLORING BOOKS AND THINGS WITH AR THAT WOULD BARELY GET OFF THE GROUND IN THE STATES OR IN EUROPE ARE, LIKE, TENS OF MILLIONS OF REVENUE IN CHINA. THE WILLINGNESS TO TRY NEW THINGS OUT, TEST THEM, PUSH THEM OUT IS, YEAH, A WHOLE OTHER LEVEL, BUT IT’S — AGAIN, IT’S VERY DIFFERENT TO COME FROM THE OUTSIDE AND TRY AND SUCCEED IN THAT MARKET. IT’S NOT JUST ALIEN. IT’S SO COMPETITIVE.>>THE VR CAGE OVER THERE ARE INSANE. IT’S LIKE HOW WE GO TO THE MO MOVIES. OVER THERE PEOPLE GO TO VR ARCADES. THE GAMING ECOSYSTEM IS REALLY WELL-DEVELOPED, AND EVERYTHING IS CHANGING REALLY, REALLY QUICKLY. I DON’T KNOW IF YOU READ THE NEWS THAT A COUPLE OF WEEKS AGO CHINA’S GOVERNMENT DECIDED TO REGULATE THE GAMING MARKET IN CHINA AND THE STOCK DROPPED 20% OVERNIGHT. THAT’S UNBELIEVABLE. THIS IS WHERE WE’RE HEADING WITH THE DECK NOLG WORLD RIGHT NOW BECAUSE WE TRULY MADE IT. WE’VE BECOME MAIN STREAM. ANYTHING WE BUILD HAS HUGE, HUGE INTENDED AND UNINTENDED CONSEQUENCES. WE’RE HAVING A GOVERNMENT THAT REGULATES HOW MANY GAMES CAN BE BUILT OR HOW MANY GAMES CAN BE RELEASED? THAT’S INCREDIBLE. NO COMPANY HAS TO THINK OF THAT BEFORE AS A RISK. WHEN PEOPLE ARE SPENDING SO MANY HOURS AND SO MUCH MONEY ON THE TECHNOLOGY THEY’RE USING EVERY DAY, THIS IS THE RATIONALE NEXT STEP.>>WE’VE ONLY GOT A LITTLE — WE’VE ONLY GOT A COUPLE OF SECONDS LEFT, BUT NIKO, I WANT TO ASK YOU A QUESTION. YOU’VE BEEN INVESTING FOR A LITTLE WHILE NOW IN THIS SPACE. HOW HAS YOUR BULL SHIT SENSOR EVOLVED OVER THE LAST COUPLE OF YEARS? I FEEL LIKE THERE’S BEEN A LOT OF BULL SHIT.>>WELL, THERE’S BEEN A TON OF BULL SHIT, AND THAT’S PART OF THE REASON WHY WE HAVE NOT INVESTED REALLY, REALLY BIG DOLLARS IN THE SPACE SO FAR, RIGHT? FOR US WE WANT TO FIND INDIVIDUALS, DOMAIN EXPERTS THAT WANT TO DO THE RIGHT THING, UNDERSTAND THEIR CUSTOMER DEEPLY, SO WHEN YOU ASK PEOPLE WHO IS YOUR CUSTOMER, WHY DO THEY WANT TO BUY YOUR PRODUCT, HOW MANY OF THEM HAVE YOU TALKED TO, HOW ARE YOU GOING TO GET TO THEM? YOU CAN EASILY FIGURE IT OUT IF THEY KNOW WHAT THEY’RE TALKING ABOUT OR IT’S COMPLETE BS. ONCE IN A WHILE YOU’RE GOING TO STUMBLE UPON SOMEBODY THAT’S BIPOLAR AND CAN PAINT A DETAILED PICTURE OF HOW THE WORLD IS GOING TO LOOK LIKE IN A FEW YEARS, AND YOU ARE, LIKE, SHIT, IF THIS COMES TRUE, I BETTER BE PART OF THE PICTURE, AND AFTER YOU WRITE THE CHECK, YOU ARE PRAYING, IS IT GOING TO HAPPEN? WAS IT THE RIGHT PERSON? IS SHE OR HE GOING TO BUILD IT? I MEAN, I HAVE TO SAY, YOU KNOW, I’VE MADE THAT MISTAKE BEFORE. ALL OF US HAVE. WE’LL FIND OUT OVER THE NEXT FEW YEARS.>>WELL, I THINK THAT JUST ABOUT WRAPS IT UP. WE’RE OVER TIME. THANK YOU, GENTLEMEN, FOR JOINING ME, AND LOOK FORWARD TO SEEING WHAT COMES OUT OF YOUR COMPANIES.>>THANK YOU.>>THANK YOU FOR HAVING US.>>THANKS, GENTLEMEN. OKAY. I’M PARTICULARLY INTERESTED IN THIS NEXT PANEL. PLEASE WELCOME TO THE STAGE FROM TOPEA BRIN KENNEDY AND YOUR MODERATOR JOHN SHEEBER. ♪>>THANKS, ANTHONY. I KNEW I COULD COUNT ON YOU. HOW IS EVERYONE DOING THIS MORNING? HOW IS EVERYBODY DOING THIS MORNING? WAS EVERYONE AT THE PARTY TOO LATE LAST NIGHT? JEEZ.>>WITH I KNOW. IT SEEMS A BIT EMPTY, HUH?>>ALL RIGHT. ROCKING THAT HANGOVER. THANKS SO MUCH FOR JOINING US.>>YOU’RE WELCOME.>>I’M REALLY STOKED TO BE TALKING TO YOU TODAY. I WAS HOPING FOR THE AUDIENCE YOU COULD GIVE THEM A LITTLE BIT OF AN OVERVIEW ABOUT WHAT TOPIA IS AND WHAT EXACTLY YOU’RE WORKING ON.>>I’M THE FOUNDER AND CEO OF TOPIA, AND WE WORK WITH THE BIGGEST COMPANIES IN THE WORLD, AND THEY USE OUR SOFTWARE TO MOVE THEIR EMPLOYEES BETWEEN ALL THEIR DIFFERENT OFFICES. YOU AND I HVE BOTH WORKED AND MADE IT AROUND THE WORLD. YOU WOULD USE TOPIA TO HELP ORGANIZE EVERYTHING THAT’S HERE IN A NEW OFFICE LOCATION.>>PERSONAL EXPERIENCE, MOVING ACROSS THE GLOBE IS KIND OF A NIGHTMARE.>>TERRIBLE, HUH? IF YOU DON’T HAVE TOPIA.>>AT THAT POINT NOBODY DID. I WON’T REVEAL HOW OLD I AM, BUT THAT WASN’T A THING WHEN THE SBNLT — THE INTERNET RAIL WASN’T A THING WHEN I WAS MOVING. WHAT INSPIRED YOU TO DEDICATE, LIKE, TEN YEARS OF YOUR LIFE TO A BUSINESS FOCUSED ON RELOCATION? WAS IT REALLY JUST THE PERSONAL HASSLE THAT YOU HAD?>>YEAH, SO I WENT TO COLLEGE, LEARNED CHINESE, MOVED TO ASIA, AND SPENT THE FIRST PART OF MY CAREER WORKING IN FINANCE ACROSS HONG KONG, SINGAPORE, INDIA, AND LIVED IN THE U.K. ALSO. LITERALLY EVERY TIME I MOVED, I WAS, LIKE, THIS IS TERRIBLE. LIKE, I WOULD GO TO A RESTAURANT WITH ALL THESE OTHER PEOPLE, AND WE WOULD HAVE DRINKS, AND WE WOULD ALL BE, LIKE, THIS IS SO BAD. IT’S SO HARD TO MOVE. WHY CAN’T MY COMPANY FIGURE OUT HOW TO DO THIS BETTER? WHEN I WENT TO BUSINESS SCHOOL, I WAS, LIKE, THIS IS A BIG PROBLEM THAT HAS TO BE SOLVED FOR PEOPLE LIKE ME, AND THEN TWO YEARS OF ANALYTICAL GOOD MBA WORK, I UNCOVERED THREE BIG TRENDS — GLOBALIZATION, DEMOGRAPHIC CHANGE IN THE WORK FORCE, AND AI DISRUPTION — THAT MADE THIS IDEA OF WHAT HE WITH CALL TODAY TALENT MOBILITY, SO MOVING BETWEEN TEAMS AND LOCATIONS. REALLY CORE FOR COMPANIES.>>THAT IS THE SORT OF WHERE THE COMPANY HAS EVOLVED INTO, BUT WHEN YOU STARTED, WAS THAT REALLY THE THESIS WHEN YOU STARTED, OR DID YOU SORT OF GROW INTO THIS UNDERSTANDING OF THE BROADER SORT OF WORK FORCE MARKETPLACE?>>MY INITIAL MOTIVATION WAS, LIKE, IT SUCKS TO MOVE. I’VE DONE IT SO MANY TIMES. I’VE MET HUNDREDS OF PEOPLE THAT SAY IT SUCKS TO MOVE. IT’S LIKE DOING IT IN THE 1980s. THIS SHOULD BE AS EASY AS TRAVEL.>>RIGHT.>>THAT WAS MY INITIAL THESIS WAS THE HUMAN PROBLEM, WHICH CONTINUES TO BE A BIG PART OF WHAT WE DO TODAY. THEN THE ANALYTICAL PIECE AND SORT OF THE $30 BILLION TECHNOLOGY CATEGORY THAT EVERY ENTERPRISE ON THE PLANET IS TALKING ABOUT TODAY, THAT CAME WITH A LOT OF WORK THEREAFTER.>>YOU HAVE RAISED, WHAT, LIKE, $91 MILLION FOR THIS BUSINESS. HOW LARGE IS THE TOTAL MARKET FOR RELOCATION SERVICES?>>SO IT’S ABOUT A $30 BILLION MARKET, ACTUALLY. EVERY COMPANY IN THE WORLD IS MOVING THEIR EMPLOYEES TODAY. YOU SAY RELOCATION. WE PROBABLY FIRST THINK, OKAY, SOMEONE PERMANENTLY MOVING FROM POINT A TO POINT B. THAT’S A RELOCATION. THAT’S JUST A SMALL PART OF WHAT WE DO TODAY. WE SUPPORT ANY EMPLOYEE WHO IS MOBILE. COULD BE YOU GOING FROM L.A. TO BERLIN AND SPENDING A MONTH HERE TO PUT ON THIS CONFERENCE. WE COULD HELP YOU WITH THE HOUSING, THE TAXES, THE IMMIGRATION, MANAGING WHERE JONATHAN IS. THAT’S ALL MANAGED IN OUR SOFTWARE.>>AMAZING. I THINK MY PARENTS WOULD ACTUALLY LOVE THAT, TO MANAGE WHERE JONATHAN IS.>>TO CHECK WHERE YOU ARE.>>SO — >>THEY’RE NOT BUYERS.>>HOW DO YOU PARSE THAT MARKET OUT? $30 BILLION BREAKS DOWN. WHAT’S THE LARGEST CATEGORY IN HAT?>>THE WAY TO THINK ABOUT IT IS EVERYTHING TAT YOU WORK IN HR, THEY ADMINISTER BENEFITS AND DO WORK FORCE PLANNING AND PERFORMANCE REVIEWS. THEY TRACK EMPLOYEE DATA. THEY MANAGE PAYROLL. THEY HAVE AN EMPLOYEE INTERFACE. ALL OF THAT STUFF WE DO FOR ANY MINUTE THEY LEAVE THEIR HOME OFFICE. THERE’S ALL KINDS OF DIFFERENT APPLICATIONS. IT’S A MUCH BETTER HR PLATFORM, ND RELOCATION PLATFORM THAN KIND OF YOU INITIALLY THINK WHEN YOU HEAR ABOUT OUR BUSINESS.>>HOW MUCH OF THAT ACTUALLY THEN ENKROECHZ ON WHAT’S HAPPENING FROM — WITH S.A.P. OR WITH WORK DAY? IS THAT SORT OF THE ECOSYSTEM THAT Y’ALL SLOT INTO? ARE THEY PARTNERS? ARE THEY COMPETITORS?>>YEAH, THEY ACTUALLY — WORK DAY IS A PARTNER OF OURS, AND WE DO INTEGRATE WITH SSAP AS WELL. WE INTEGRATE WITH ALL THE BIG HR PLATFORMS, PAYROLL PLATFORMS, FINANCE PLATFORMS THAT ARE CUSTOMERS. NONE OF THEM HAVE SOLUTIONS FOR TALENT MOBILITY. IT’S REAL NEW. WE KIND OF DEVELOPED THE CATEGORY. NOW EVERYONE IS KIND OF EXCITED ABOUT IT, BUT I PROMISE YOU EIGHT YEARS AGO WHEN I WAS DRIVING UP AND DOWN 101 IN CALIFORNIA EVERYONE THOUGHT I WAS AN INSANE PERSON, BUT NOW EVERYONE NEEDS THIS. WE DO WORK CLOSELY WITH THOSE COMPANIES AND INTEGRATE WITH THEM, AND WE ARE VERY COMPLIMENTARY.>>HOW DOES THAT — HOW DOES THAT WORK TO SORT OF CARVE OUT A CATEGORY? I THINK ABOUT, LIKE, THE RECENT ACQUISITION, RIGHT? A $9 BILLION DEAL IN A CATEGORY THAT THEY KIND OF INVENTED, RIGHT?>>TURNS OUT CATEGORY CREATION IS KIND OF GOOD.>>FOR ENTREPRENEURS IN THE AUDIENCE THAT MIGHT WANT TO START A $9 MILLION BUSINESS OR BE ABLE TO GAL VANITY AROUND THE WORLD AND HAVE HOMES IN VARIOUS LOCATIONS ON THE EAST COAST AND BUY ART IN FANCY PLACES, WHEN — HOW DO YOU RECOMMEND THEY GO ABOUT THINKING ABOUT WHAT COULD BE A CATEGORY TWO DEVELOP? YOU KNOW WHAT I MEAN?>>YEAH WHERE. >>HOW DOES THAT WORK? HOW DOES PARSING A MARKET OR SLICING IT UP INTO A NEW SORT OF CATEGORY ACTUALLY HAPPEN?>>SO THE WAY THAT I THINK ABOUT IT AND WHAT I DID IS FOR START WITH WHAT YOU KNOW, START WITH SOMETHING THAT’S A REALLY BIG PAIN POINT IN YOUR LIFE, AND THEN THE QUESTION IS IS IT A PAIN POINT IN OTHER PEOPLE’S LIVES? IF IT IS, THEN IT’S HOW BIG OF A PAIN POINT IS IT, AND HOW MANY PEOPLE’S LIVES, SKPS, THEREFORE, WHAT’S THE MATH BEHIND IT. THAT’S WHAT I DID INITIALLY, AND I DID KIND OF ALL MY OWN ANALYTICS AROUND THAT. THAT WAS KIND OF THE EARLY ROUNDS OF FINANCING, AND I THINK PEOPLE LIKE HALF BELIEVED ME IN THE THEORY AND SAID THIS IS A BIG ROUND. PEOPLE SAY NICE THINGS, AND PEOPLE SAY NOT NICE THINGS WHEN YOU FUNDRAISE, BUT I THINK GENERALLY PEOPLE HALF BELIEVED MY MATH. THEN WHEN WE GOT TO BE A BIG ENOUGH COMPANY AND HAVEENOUGH MONEY, ACTUALLY, PAID PEOPLE WHO HAD WORKED AT McKENZIE AND ACTUALLY DO A MARKET, AND THEY CAME BACK WITH ABOUT $30 BILLION NUMBER. HEY, VC, GUESS WHAT, THEIR MATH ACTUALLY IS HIGHER THAN MY MATH. EVERYONE WAS, LIKE, OH, WOW. THIS IS INTERESTING. YOU DIDN’T BELIEVE ME. A LITTLE BIT OF IT IS KIND OF SALES DEDUCTIVE REASONING AT THE BEGINNING. FUNDAMENTALLY A LITTLE BIT OF A BET BASED ON PERSONAL PAIN. THEN I THINK AS THE BUSINESS EVOLVES AND YOU NEED MORE SOPHISTICATED MATH BEHIND IT, YOU GET SOME PROFESSIONALS TO DO THAT.>>GIVEN THE WINDOW THAT YOU HAVE IN SO MANY DIFFERENT ASPECTS OF SORT OF OPERATIONS AT A BUSINESS, IF YOU ARE GOING TO START A NEW COMPANY TODAY, WHERE DO YOU SEE PAIN POINTS THAT STILL EXIST FOR FORTUNE 500s THAT COULD BE NEW CATEGORIES THAT OTHER PEOPLE MIGHT DEVELOP?>>OH, GOSH, FORTUNE 500 COMPANIES HAVE A SURPRISINGLY LARGE AMOUNT OF OPPORTUNITIES FOR DISRUPTION AND SERVICES. ONE THING THAT WE SEE REGULARLY — THIS IS NOT GOING TO BE NEWS FOR ANYONE IN THIS ROOM, BUT IS THE FINANCIAL FLOW OF MONEY BETWEEN DIFFERENT PLACES, RIGHT? THIS IS WHERE TECHNOLOGIES LIKE BLOCK CHAIN CAME IN. IT’S INCREDIBLY CUMBERSOME FOR THE COMPANIES THAT WE WORK WITH TO DO REAL BASIC THINGS, LIKE PAY YOU $5,000 WHEN YOU ARE MOVING TO GERMANY FROM THE U.S. OR GET YOU ON THE RIGHT PAYROLL AND PHYSICALLY GET CASH TO YOU WHEN YOU ARE SOMEWHERE ELSE. WE DO A LOT OF THE CALCULATION WORK BEHIND THAT, BUT, LIKE, THE PHYSICAL MOVEMENT OF MONEY GLOBALLY IS SUCH A HUGE OPPORTUNITY IN TODAY’S ERA. CONSUMER AS WELL AS ENTERPRISE.>>WHEN YOU THINK ABOUT THE RELOCATION MARKET SPECIFICALLY, I WANT TO GET BACK INTO THAT, YOU MENTIONED THAT IT’S A $30 BILLION INDUSTRY. OTHER PEOPLE MUST ALSO BE RECOGNIZING THIS AS WELL, AND IMAUTO STARTING TO SEE, LIKE, ABNB OFFERING SERVICES LIKE THIS. WE WORK AS A MONEY PIT IN SEARCH OF AN ACTUAL BUSINESS, AND I’M ASSUMING THEY WOULD WANT TO GET INTO THIS TOO AT SOME POINT. HOW ARE YOU SEEING THE COMPETITIVE LANDSCAPE EVOLVE? ARE YOU SEEING ABNB ENCROACHING ON YOUR TURF? ARE YOU SEEING WE WORK TO MAKE MOVES IN THIS AS WELL.>>IT’S A SUPER INTERESTING CATEGORY BECAUSE IT’S SO TIED TO HOW YOU AND I AND ALL THE MILLENIALS — WHAT WE SEE IS — WHEN I STARTED THIS, THERE WERE THESE REALLY OLD ARCHAIC RELOCATION VPO’S AND THE BIG FOUR THAT KIND OF DOMINATED THE INDUSTRY, AND SO THEY STILL EXIST, AND THEY’RE ALL TRYING TO UPDATE THEIR OWN BUSINESSES AND BECOME TECHNOLOGY COMPANIES, SO THAT’S ONE AREA. THEN YOU HAVE THE WE WORKS, THE AIR BNB’S, THOSE KIND OF COMPANIES THAT HAVE HISTORICALLY MAYBE PLAYED A LITTLE BIT MORE IN A CONSUMER TRAVEL SPACE OR OFFICE SPACE, BUT THOSE ARE REALLY TIED TO THE TRENDS THAT ARE HAPPENING, SO WE SEE THEM SORT OF STARTING TO DIP THEIR TOES MORE IN THE PROVISION OF CORPORATE SERVICES. THEN YOU ACTUALLY — THERE’S QUITE A LOT OF START-UPS THESE DAYS DOING VARIOUS THINGS IN, LIKE, THE SHIPPING MARKET OR THE EMPLOYEE MOVEMENT MARKET. THERE’S SOME THAT ARE STARTING TO COMPETE WITH US. THIS IS WHAT HAPPENS WHEN CATEGORIES GET BIG, RIGHT? THE FIRST PERSON EG ME IS THE CRAZY PERSON THAT GETS THE DOOR SLAMMED IN THEIR FACE BY NINE OUT OF TEN VC’S FOR FIVE YEARS, AND THEN ALL OF A SUDDEN YOU GO TO DINNERS, AND ALL THE VC’S ARE, LIKE, OH, WHY DIDN’T I INVEST? I’M, LIKE, THREE YEARS AGO YOU TOLD ME I WAS A CRAZY PERSON, AND THEN ALL OF A SUDDEN, WELL, THEY’RE I’M INVESTING IN THIS AND THIS AND THIS. WE LIKE THAT BECAUSE IT VALIDATES THE CATEGORY. WE ARE ON FAR AHEAD OF EVERYONE ELSE IN THIS SPACE. IT’S REALLY, REALLY EXCITING BECAUSE I BELIEVE FUNDAMENTALLY IN THIS SPACE AND THAT IT IS THE FUTURE.>>WELL, SO I — I WANT TO GET INTO THAT FOR A SECOND IN A BIT, BUT TALKING ABOUT HOW YOU BUILD THE COMPANY OUT FOR A SECOND, YOU JUST MADE A COUPLE OF ACQUISITIONS FAIRLY RECENTLY, LIKE OVER THE LAST YEAR YOU BOUGHT TWO COMPANIES, RIGHT? WHAT WAS THE THINKING BEHIND THOSE ACQUISITIONS? WAS IT GEOGRAPHIC MARKET EXPANSION? WAS IT BUYING INTO A TECHNOLOGY?>>THEY WERE ACTUALLY QUITE DIFFERENT. THE FIRST COMPANY THAT WE BOUGHT IS CALLED TELEPORT. THEY’RE HEAD QUARTERED IN ESTONIA, AND THEY HAD BUILT SOME INCREDIBLE TECHNOLOGY FOR EMPLOYEES FOR MOBILE. THEY HAD DEFINED COST AND QUALITY OF LIFE ACROSS SIX DIFFERENT ALGA — YOU COULD SAY I LIKE JAZZ BARS IN L.A. WHAT’S THE DENSITY OF JAZZ BARS AND RANK ALL THESE DIFFERENT FACTORS? WE WANTED THAT TECHNOLOGY AND THAT IP FOR OUR EMPLOYEE EXPERIENCE BECAUSE WE THOUGHT IT WAS REALLY UNIQUE AND REALLY VUBL U VALUABLE. WE ALSO LOVE ESTONIA. WE LOVE THE STRATEGIC LOCATION AND WE LOVE THE ENGINEERING TALENT. WE LOVE THE FOUNDERS OF TELEPORT, AND WE WANTED THEM. THAT WAS KIND OF THE IMPOTES BEHIND TELEPORT. A LITTLE BIT OF AN OLDER COMPANY, POLARIS. THEY HAD SPECIFIC TECHNOLOGY THAT WE WANTED. THEY HAD DEVELOPED A GLOBAL TAX ENGINE. THE ONLY PEOPLE THAT HAD REALLY AUTOMATED WHAT THE BIG FOUR DO, AND SO IT’S KIND OF LIKE BORING, I GUESS I WOULD SAY. YOU KNOW, TAX, UNLESS YOU ARE — YOUR BLOOD GETS RUNNING THROUGH BY TAX.>>I KNOW PEOPLE THAT GET EXCITED.>>I DON’T EVEN LIKE TO DO MY OWN TAXES. IN THIS SPACE, IF YOU HAVE A FOOTPRINT ACROSS STATES, ACROSS COUNTRIES, CALCULATING TAX AND MAKING SURE YOU DON’T HAVE SOME CRAZY BILL, IT’S SUPER, SUPER IMPORTANT. WE NEEDED THAT IP, AND SO WE BOUGHT THAT ALONG WITH A COUPLE OTHER THINGS WITH POLARIS, PUT THAT ALL TOGETHER, AND ALL OF A SUDDEN WE HAVE A FULL SUITE FOR ANYONE THAT’S MOBILE IN THE ENTERPRISE.>>ARE THERE HOLES THAT YOU WOULD LIKE TO FILL, AND ARE THOSE THINGS YOU WOULD BE BUILDING OR BUYING? ARE YOU SHOPPING RIGHT NOW? SHOULD COMPANIES SORT OF SEND — IF THEY ARE — >>THIS IS SUCH A TECH CRUNCH DISRUPT JOURNALIST QUESTION.>>SERIOUSLY, I MEAN, LIKE ARE THERE THINGS OUT THERE THAT YOU WOULD LIKE TO ACQUIRE THAT YOU WISH WERE IN YOUR PRODUCT SUITE RIGHT NOW?>>WE’RE NOT ACTIVELY LOOKING RIGHT NOW. WE’RE PRETTY FOCUSED ON BRINGING A COUPLE TO US RIGHT NOW ON THE USE SIDE. OUR MAIN FOCUS RIGHT NOW BECAUSE WE HAVE JUST DONE A LOT. WE’RE ALWAYS OPPORTUNISTICALLY LOOKING AT DIFFERENT AREAS AS THE MARKET EVOLVES, AND WHAT WE’RE SEEING IN THE MARKET IS MUCH, MUCH, MUCH MORE MOVEMENT FOR SHORTER PERIODS OF TIME. YOU SPEND THREE WEEKS IN BERLIN, TWO WEEKS IN MOSCOW, FIVE WEEKS IN TOKYO, ONE WEEK IN CALIFORNIA. LIKE, THAT’S MAYHEM FOR YOU AND AN ENTERPRISE TO MANAGE FROM A TAX, IMMIGRATION, AND BUSINESS TRAVEL PERSPECTIVE. THERE’S THIS CONVERGENCE OF BUSINESS TRAVEL AND TALENT MOBILITY. THAT’S AN AREA THAT IS COMPELLING TO US IN THE FUTURE AS TO HOW WE APPROACH IT.>>HOW MUCH OF THIS GETS ERADICATED AS AUTOMATION INCREASES, AS TELEPRESENCE INCREASES, AND AS COMPANIES LOOK TO LOCALIZE AND ACTUALLY SORT OF WORK REMOTELY, BECOMES MORE OF A THING?>>THAT’S A GREAT QUESTION.>>WELL, THANKS.>>WELL PREPARED. HE WOULDN’T LET ME SEE — TAKE A PEEK AT HIS QUESTIONS BEFORE THIS.>>SPOILERS. NO SPOILERS.>>WE FIND A CATEGORY OVERALL. THE KIND OF BROADER WHERE IS THE TALENT MOBILITY MOVEMENT OF PEOPLE CATEGORY GOING AS A SPECTRUM THAT INCLUDES EVERYTHING FROM FULLY REMOTE TEAMS TO TRADITIONAL EX-PATRIOT AND RELOCATION. IT’S LIKE ANYONE OUT OF THE OFFICE AND ALL THE ADMINISTRATION AND EXPERIENCES AND DATA THAT’S ASSOCIATED WITH THEM E THEM. TO YOUR POINT, WE DON’T REALLY DO MUCH IN OUR CURRENT PRODUCT SUITE FOR THE FULLY REMOTE EMPLOYEE AND CREATING TELEPRESENCE AND THOSE KINDS OF THINGS. THOSE ARE DEFINITELY AREAS THAT I THINK IN THE FUTURE AS WE LOOK AT THE WHOLE TALENT MOBILITY CATEGORY, WE WOULD WANT TO OWN THAT WHOLE SPECTRUM OF ADMINISTRATION OF ALL OF THE MOBILITY.>>THAT’S THE $30 BILLION FIGURE, RIGHT? THAT’S WHERE YOU GET TO THAT — >>IT DOESN’T INCLUDE THE FULLY REMOTE. WHEN WE DID THE MARKET SIZING, WE TOOK OUR CURRENT SUITE, OUR CURRENT PRICING MODEL AND APPLIED IT TO DEMAND. THAT’S HOW THAT NUMBER ARRIVED. IT COULD BE — I DON’T THINK THAT WE REALLY KNOW WHAT THAT LOOKS LIKE FROM A PRODUCT PERSPECTIVE YET. WHAT DOES IT LOOK LIKE TO MANAGE PEOPLE WHO ARE REMOTELY WHAT IS THE ENTERPRISE NEED AROUND THAT? EVERYONE IS STILL FIGURING THAT OUT. I’M WRITING A BOOK ABOUT THIS RIGHT NOW, ACTUALLY. THE INTERESTING THING IS WE DON’T GET — WE THINK IT’S ONE CATEGORY OF MOVEMENT OF EMPLOYEE, AND THAT PERSON CAN BE REMOTE. THEY CAN BE TRAVELING. THEY CAN BE MOVING, AND THE REALITY IS WE ALL WORK ACROSS THAT SPECTRUM AT DIFFERENT POINTS IN OUR CAREER TODAY.>>WELL, SO IT’S INTERESTING BECAUSE TO ME IT SEEMS LIKE A LOT OF WHAT’S HAPPENING OR THE MOST SUCCESSFUL SOFTWARE COMPANIES OR SOFTWARE AS A SERVICE COMPANIES SORT OF START WITH A VERY SORT OF CLEARLY DEFINED NICHE AND THEN EXPAND THAT OVER TIME TO ENCOMPASS MORE AND MORE ASPECTS OF SORT OF ANCILLARY CATEGORIES, AND IT SEEMS LIKE THA’S WHAT YOU HAVE BEEN DOING. WHEN YOU SIZE UP THE MARKET, WHAT WAS THE NUMBER THAT YOU PITCHED TO VC’S? WAS IT $2 BILLION? WAS IS>>IT WAS INITIALLY 11, THE PHYSICAL — THE RELOCATION PIECE OF IT, THAT YOU GO FROM POINT “A” TO POINT “B” ONCE AS A TRANSACTION. AND MAYBE LIKE 10 YEARS LATER YOU GO FROM POINT “A” TO POINT “B” AGAIN. SO THAT WAS 10 TO 11. THAT WAS MY SORT OF EXCEL SPREAD SHEET FROM BUSINESS SCHOOL. A $10 BILLION MARKET IS STILL HUGE, ESPECIALLY IN THE ENTERPRISE CONTRACT, SO THAT WAS COMPELLING. THEN AS WE EXPANDED THE BUSINESS WE ADDED THE SHORT TERM MOVEMENT, THE WORKFORCE PLANNING, THE PAYROLL CALCULATIONS. AND THAT EXPANDED IT TO 30. AGAIN, LIKE CONCENTRIC CIRCLES. THE CIRCLE WE HAVEN’T GOTTEN TO YET IN TERMS OF SIZING OR IN TERMS OF PRODUCT IS THE REMOTE WORKER AND COMMUTER AND WHAT DOES THAT LOOK LIKE FROM A PRODUCT PERSPECTIVE?>>DOES THAT SORT OF BUMP UP AGAINST THINGS LIKE ZENEBITS, TO GET TO THAT FULL SUITE OF SERVICE DOZEN YOU NEED TO ACQUIRE OR BE ACQUIRED BY ANOTHER VENDOR TO INTEGRATE ALL OF THAT FULLY?>>SO IT BUMPS UP AGAINST A LOT OF DIFFERENT PEOPLE, RIGHT? THAT’S THE OTHER THING ABOUT CATEGORY CREATION IS, TO YOUR POINT, POINTS IN THE MIDDLE THAT ONE PERSON OWNS. AND THEN THERE’S A LOT OF POINTS THAT PEOPLE OWN. THEN THERE’S A LOT OF GRAY AROUND THE CIRCLE. AND SO THE WAY THAT WE THINK ABOUT THAT IS, SHOULD WE PARTNER? SHOULD I OR — OR IS THERE ANOTHER ROUTE? SO A LOT OF WHAT WE THINK ABOUT IN OUR SUITE IS HOW DO WE PARTNER? HOW DO WE PARTNER WITH NOT ONLY THE TRADITIONAL PARTIES LIKE THE RELOCATION COMPANY, THE BIG FOUR, THE IMMIGRATION FIRM, HOW DO WE PARTNER WITH THE HR VENDORS, THE WORKDAY, THE SUCCESS VECTORS, THE ADP? THEN THERE IS A CATEGORY, FOR LACK OF A BETTER TERM, NEW AGE KIND OF PEOPLE IN THIS REMOTE WORK EMPLOYEE MOVEMENT SPICE, LIKE AN AIRBNB, AND HOW DO WE ALL WORK TOGETHER, WHICH IS ALL OF OUR GOAL, OR MY GOAL, TO HELP THE CUSTOMER MOVE FORWARD, THE EMPLOYEE MOVE FORWARD FOR THE FUTURE? THAT’S MORE HOW I THINK ABOUT IT. >>GIVEN THE WINDOW THAT YOU HAVE AND SOME MOBILITY AND REMOTE WORKFORCES AND WHAT’S GOING ON WITH MOVEMENT OF TALENT AROUND THE WORLD, THERE’S BEEN A LOT OF TALK IN EUROPE AND THE UK AROUND BREXIT AND THE IMPACT THAT’S GOING TO HAVE BOTH ON THE STARTUP AND TECHNOLOGY ECOSYSTEM. GIVEN YOUR WINDOW INTO THE WORLD, UK OR EU? WHICH IS — WHICH SEEMS TO BE THE BETTER BET RIGHT NOW FOR STARTUP?>>I LIVED IN THE UK FOR 6 1/2 YEARS SO IT’S NEAR AND DEAR TO MY HEART. BUT WOULD SAY AS A CEO IS WE FEEL THAT THE OPPORTUNITY TO RECRUIT PEOPLE IN THE EUROPEAN UNION, PARTICULARLY ON THE TECHNICAL SIDE, IS MUCH EASIER THAN IT IS IN THE UK TODAY. I SHARED WITH YOU EARLIER AT ONE POINT ABOUT THREE YEARS AGO, WE HAD ALL OF OUR ENGINEERING IN LONDON, AND 70% OF OUR ENGINEERING TEAM WAS NON-UK NATIONALS. WE GOT APPLICATIONS EVERY DAY. MANY OF THEM FROM OUTSIDE OF THE UK. THAT DRIED UP OVERNIGHT WITH THE BREXIT VOTE. AND SO WE NOW HAVE OUR ENGINEERING LOCATION IN ESTONIA. IT’S A WONDERFUL ECONOMY WHERE YOU CAN RECRUIT PEOPLE FROM ALL OVER THE WORLD. NOW I THINK 50% OF OUR ESTONIAN OFFICE IS NON-EU NATIONALS, LET ALONE NON-ESTONIAN NATIONALS. >>TO FURTHER PARSE THIS NOW IN THE WANING SECONDS THAT WE HAVE LEFT, PARIS OR BERLIN?>>WELL, THIS IS MY FIRST TRIP TO BERLIN SO LET ME TAKE A RAIN CHECK AND TELL YOU MONDAY AFTER I DO THE RECOMMENDATIONS YOU TOLD ME BACKSTAGE. >>THIS CITY IS REMARKABLE, SO IS PARIS. >>I SPEAK FRENCH AND I’VE SPENT A LOT OF MY LIFE IN FRANCE SO I’M PARTIAL. IT WILL BE A GREAT WEEKEND YOU’VE SET UP FOR ME. >>YOU RAISED $91 MILLION. IF YOU WERE TO GIVE A STARTUP CEO ONE TIP ABOUT HOW TO APPROACH THE FUND-RAISING PROCESS, WHAT WOULD IT BE?>>I HAVE SO MANY. I DON’T KNOW HOW TO DECIDE ON ONE. >>THEY CAN TWEET AT YOU AFTER AND YOU CAN HAVE A CHAT WITH THEM. PUT IF YOU WERE TO SAY ONE THING WHAT SHOULD AN ENTREPRENEUR KEEP IN MIND AS THEY THINK ABOUT FUND RAISING?>>I THINK, KNOW YOUR MARKET REALLY WELL, AND WHY IT CAN BE VERY LARGE. AND HAVE A PLAN TO GET THERE. >>HAVING CREATED A $30 BILLION MARKET, YOU WOULD KNOW MORE THAN MOST. ALL RIGHT, THANK YOU SO MUCH FOR THE TIME, I REALLY APPRECIATE IT. THANK YOU ALL FOR LISTENING. CHEERS.>>THANK YOU.>>>GET A CONVERSATION GOING. HEY, THANKS. HELLO, GUYS. ALL RIGHT. LET’S TALK ABOUT FINTECH. AND I NAMED THIS PANEL FINTECH FEVER. BECAUSE I THINK THE ADORATION IN F IS PRETTY GOOD, FOR ONE. MANY PEOPLE ARE THINKING THERE’S A LOT OF MONEY GOING INTO FINTECH RIGHT NOW, A LOT OF COMPANIES. SO WE’RE GOING TO DISCUSS THAT AS WELL AS YOUR COMPANIES. MAYBE LET’S START WITH YOU, RICKY. BECAUSE AS WE WERE JUST STAYING BACKSTAGE, YOU STARTED TANDEM QUITE A FEW YEARS AGO. YOU WERE AHEAD OF THE CURVE IN MANY WAYS. HOW DID YOU FEEL WHEN SO MANY COMPANIES TRIED TO JOIN THIS SPACE?>>YEAH, LOOK, I THINK IT’S REALLY INTERESTING. BECAUSE CHALLENGER BANKING, ALTHOUGH PEOPLE TALK ABOUT IT BEING SUPER BUSY, IN THE UK WE DO HAVE SOME COMPETITORS. N-26 IS REALLY ONE OF THE ONLY EUROPEAN PLAYERS IN THIS SPACE. IN THE UK, BECAUSE WE HAD A CHANGE IN LEGISLATION IN 2012, WE DECIDED TO SET UP A CHALLENGER BANK. AND AT THE TIME EVERYONE THOUGHT WE WERE CRAZY BECAUSE THEY WERE LIKE, HOW ARE YOU GOING TO TAKE ON THESE MASSIVE GOLIATHS? ACTUALLY IT TURNED OUT A FEW PEOPLE HAVING THE IDEA AT THE SAME TIME. EUROPEANS MIGHT NOT KNOW THE STORY BUT MONZO WAS STARTED OUT OF STARLING. US AND ATOM STARTED FIRST, THEN STARLING STARTED, THEN THEY HAD A HUGE FALLOUT, AND CTO AND MOST OF THE MANAGEMENT TEAM LEFT AND FORMED MONZO. THREE STARTERS EMERGED INTO FOUR PLAYERS. YOU LOOK AT THE UK MARKET, 53 BILLION POUND REVENUE POOL IN RETAIL BANKING, THE LARGEST INDUSTRY, FULL TOP. WHEN YOU TALK ABOUT FINTECH BEING THE BIG THING, 2 TRILLION OF REVENUES, IT KIND OF MAKES SENSE IF YOU’RE GOING AFTER THAT REVENUE POOL THIS WOULD BE A BI AREA. >>WHAT WAS REVENUES? YOU NAME A BUNCH OF NAMES.>>I MEAN, THE INTERESTING THING IS BEYOND THOSE FOUR THERE ARE ANOTHER 400 PREPAID STARTUPS IN THE UK. AND YOU KNOW, THAT WAS THE WAY YOU GUYS STARTED N-26. REVOLUTE HAS GONE INDUSTRY LIGHT, A GREAT ADVANTAGE IN TERMS OF GOING MULTI-COUNTRY. BUT THEY’RE ALREADY HITTING HEADWINDS WHEN IT COMES TO DOING LICENSES. WHEN WE SPOKE TO REGULATORS, CAN WE DO PREPAY FIRST? THEY SAID, WE’D RATHER YOU DIDN’T, IT WILL PREJUDICE YOUR BANK IS LICENSE. I THINK REVOLUTE IS STILL — MOST CUSTOMERS ARE COMING FOR A FOREIGN CURRENCY CARD, NOT A BANK ACCOUNT. IT DOES COMPETE BUT BY MAYBE 10%. >>ONE OF THE THINGS YOU STARTED IN BERLIN, A BIT AWAY FROM THE CROWD OVER THERE. YOU THINK THAT WAS AN ADVANTAGE?>>I THINK WE ACTUALLY STARTED IN THE HOTTEST MARKET. I THINK THAT GERMANY, IF YOU LOOK AT CONSUMERS, I THINK THEY ARE STILL MORE RELAXED THAN IN OTHER MARKETS, TO TRY NEW PRODUCTS, TO TRY NEW STARTUPS. IT MADE US STRONGER. WE’VE STARTED IN GERMANY, AUSTRIA. WE’VE EXPANDED TO AROUND 17 MARKETS, WE’RE IN FRANCE, IN ITALY. SOME OF THE FASTEST-GROWING MARKETS FOR US. AND WE’VE JUST RECENTLY EXPANDED TO FOUR MORE MARKETS. A COUPLE OF EASTERN EUROPEAN MARKETS. LAST WEEK INTO THE UK.>>THE UK YEAH. >>WHAT WE SEE IS ACTUALLY WE CAN REALLY EASILY REPLICATE WHAT WE’RE DOING IN OUR HOME MARKETS, IN OTHER MARKETS. AND WE’VE CHANGED A LITTLE BIT OF OUR VISION OVER THE LAST YEAR FROM BEING A EUROPEAN PLAYER, FIRST A GERMAN PLAYER, THEN A EUROPEAN PLAYER. WE SEE WE NEED TO TAKE THIS GLOBAL AND THAT’S WHAT WE’RE WORKING ON. AS YOU SAID, I THINK IT’S A TRILLION-DOLLAR MARKET AROUND THE WORLD. I DON’T THINK IT’S CROWDED AT ALL. I THINK IF YOU LOOK AT HOW MANY CHALLENGER BANKS OR FINTECH STARTUPS HAVE REALLY MORE THAN 1, 1.5 MILLION CUSTOMERS, MAYBE A HANDFUL OF STARTUPS IN EUROPE. I THINK IT’S MUCH TOO LITTLE, THERE SHOULD BE MORE STARTUPS ATTACKING THE MARKET. I THINK THE OPPORTUNITY IS HUGE. IF YOU GO TO THE U.S. YOU DON’T HAVE REALLY ANY PLAYERS IN THE BANKING MARKET YET. IF YOU LOOK AT THE REST OF SOUTH AMERICA, YOU HAVE ONE OR THE OTHER. I THINK IT’S A HUGE OPPORTUNITY FOR MARKETERS, SOMEWHERE BETWEEN 2 TRILLION AND 4 TRILLION IN VALUE. >>AT TANDEM, IN THE UK DO YOU THINK YOU’RE GOING TO EXPAND BEYOND THE UK?>>YES. WE ACTUALLY HAD A PRESS RELEASE WHERE WE NOW HAVE A PARTNERSHIP TO EXPAND INTO HONG KONG. WE THINK ASIA’S A REALLY INTERESTING OPPORTUNITY. WE ACTUALLY HAD SOME LIMITED OPERATIONS IN GERMANY THANKS TO THE GOOD PEOPLE BEHIND BREXIT, WE PUT THAT ON ICE TO SEE WHAT HAPPENS NEXT MARCH. BUT I THINK, YEAH, THIS IS DEFINITELY A GLOBAL PLAY. IT’S ALSO A REALLY INTERESTING THING, BECAUSE YOU KNOW, COMING BACK TO — THERE ARE SOME HUGE BANKS IN THE WORLD. BUT THERE’S ACTUALLY NO GLOBAL BANK. SO HSBC IS PROBABLY THE NEAREST YOU GET. IT’S ON THE ACTIVE AND RETAIL BANKING ABOUT THREE EUROPEAN MARKETS, EACH RESPIRATELY REGULATED. YOU CAN’T SEND ONE BETWEEN ONE OF THOSE ACCOUNTS AND THE OTHER WITHOUT A LOT OF HASSLE. IT’S ALMOST EASIER TO GET TO CITIBANK. I STUDIED IN FRANCE. GETTING MONEY FROM A LON DONE LCSB ACCOUNT TO FRANCE IS A DISASTER. THERE’S REAL OPPORTUNITY NOT JUST TO ACCESS THIS TRILLION-DOLLAR MARKET, BUT ALSO TO ACTUALLY BE THE FIRST OF A WAVE OF GLOBAL INDUSTRIES IN THE SAME WAY THAT AMAZON IS ONE OF THE FIRST GLOBAL RETAILERS. THERE’S A REALLY INTERESTING OPPORTUNITY THERE. >>BEFORE BEING GLOBAL, WOULD YOU CONSIDER TANDEM A BRITISH COMPANY OR EUROPEAN COMPANY?>>I LIKE TO CONSIDER IT A EUROPEAN COMPANY. I SPENT — I’VE ACTUALLY LIVED IN FRANCE AND SPAIN. SADLY NOT BERLIN. BUT — AND I WOULD SAY MORE AND MORE, WE’RE TALKING ABOUT THIS OFFSTAGE AS WELL, LIKE THE EUROPEAN MARKET USED TO KIND OF BE FROM A VC AND STARTUP PE PERS PERSPECTIVE, THE UK AND LITTLE BITS OF PIECES. IN THE LAST FIVE YEARS WE’VE SEEN A REAL TRANSFORMATION WHERE THERE ARE LOADS OF TECH HUBS APPEARING AND IT’S BECOMING A UNIFIED EUROPEAN MARKET. >>I THINK SALES, THE EUROPEAN REGULATION HAS BEEN REALLY GREAT, N-26, FOR INSTANCE, WE GOT A BANKING LICENSE IN GERMANY AND ABLE TO LAUNCH EVERYWHERE, BASICALLY. DO YOU THINK IT WAS A GREAT HELP TO GET STARTED AND GET CUSTOMERS HERE?>>THE EUROPEAN BANK LICENSE ENABLING YOU TO GO TO ALL THESE MARKETS IS DEFINITELY A HUGE ADVANTAGE. WE’RE NOW LIVE IN 22 MARKETS. AND IT’S OBVIOUSLY GREAT BECAUSE IT’S ONE REGULATION IN THE BACKGROUND. ON THE OTHER HAND, YOU STILL NEED TO ADAPT TO KIND OF LOCAL VERIFICATION LAWS AND A COUPLE OF COMPLEXITIES IN THE BACKGROUND. HIGH LEVEL, YOU LAUNCH IN ALL THESE MARKETS BUT THERE’S STILL A LOT OF COMPLEXITY GOING FROM MARKET TO MARKET. NOT ON THE REGULATION SIDE PER SE, BUT ON CONSUMER PROTECTION ON VERIFICATION, ON THESE STEPS. SO IT’S NOT ALL THE SAME FOR ALL THE MARKETS, BUT YOU ALSO BUILD UP SOME KIND OF EXPERTISE. SO I THINK BECAUSE WE HAVE STARTED IN ONE MARKET AND NOW IN 22, WE KNOW HOW TO NTER NEW MARKETS AND THAT HAS DEFINITELY HELPED. WE HAVE THE CAPACITY WITH N-26 NOW, 550 PEOPLE HERE IN BERLIN AND THE REST OF THE WORLD. AND THAT CAPACITY OBVIOUSLY HELPS US TO DRIVE THIS GLOBAL EXPANSION. >>I’M INTERESTED AS WELL, BECAUSE ALSO FROM HOW I UNDERSTAND IT, DEPOSIT TAKING LICENSE THAT YOU’VE GOT ALLOWS YOU TO PASSPORT IN ALL EUROPEAN COUNTRIES. THAT DOESN’T COVER CREDIT IN THE SAME WAY IN EACH COUNTRY, SO CREDIT LICENSING IS SLIGHTLY VARIABLE ACROSS THE REGION, ISN’T THAT RIGHT?>>FOR N-26, WE HAVE A FULL BANKING LICENSE SO WE CAN DO EVERYTHING FROM CREDIT TO DEPOSIT TAKING. WE CAN BASICALLY DO ANYTHING ANY OTHER BANK CAN DO. >>THAT APPLIES IN ALL EUROPEAN COUNTRIES?>>IN ALL EUROPEAN COUNTRIES. >>CONSUMER PROTECTION –>>WE’LL BE ACTUALLY — THE WEEK AFTER NEXT WE’LL BE ALSO LAUNCHING — WE LAUNCHED LAST WEEK IN THE UK WITH THE FIRST PRODUCT. WE’VE BEEN LAUNCHING IN I THINK TWO WEEKS, I THINK — IN THE NEXT MONTH, LET’S SEE, WE’LL ALSO BE LAUNCHING A CREDIT FUNCTIONITY IN THE UK, AND WE DO OUR OWN BALANCE SHEET. >>THAT’S GREAT, I DON’T HAVE TO ASK ANY QUESTIONS, YOU DID MY JOB. YOU FOCUSED ON CREDIT. LET’S TALK ABOUT CREDIT. >>SURE. >>WHY DID YOU FOCUS ON CREDIT WHERE EVERYONE IS FOCUSING ON CURRENT ACCOUNTS?>>YES, LOOK, THERE’S TWO DIFFERENT SIDES TO THIS PICTURE. ONE IS WHAT PROBLEMS YOU CAN SEE SOLVING FOR CUSTOMERS. THAT’S THE — OBVIOUSLY THE FIRST ONE YOU THINK ABOUT AS A STARTUP. YOU’VE GOT TO BE SOLVING PROBLEMS FOR CUSTOMERS. AND SO FROM THAT PERSPECTIVE, YOU KNOW, SOME OF THE MOST URGENT PROBLEMS THAT EXIST IN THE MARKET ARE THINGS LIKE RUNNING OUT OF MONEY AT THE END OF THE MONTH. IT’S ONE OF THOSE THINGS BANKS HAVE NEVER REALLY ADDRESSED. OVERDRAFT IS A SLOPPY PRODUCT TO ADDRESS A FEW DAYS’ SHORTFALL. AND INDEED IN THE UK, THERE’S A LOT OF PENAL CHARGES AROUND THAT PRODUCT. ANOTHER PERSPECTIVE IS ULTIMATELY, TALKING ABOUT THIS TRILLION-DOLLAR MARKET, YOU KNOW, ABOUT 80% OF THE BANKING REVENUE POOL IS IN CREDIT. SO, YOU KNOW, YOU CAN TALK ABOUT BANKING AND FROM A CUSTOMER PERCEPTION POINT OF VIEW, BANKING’S CURRENT ACCOUNT. FROM AN ACTUAL REVENUE PERSPECTIVE, BANKING IS CREDIT. I THINK IT WOULD BE FAIR TO SAY THAT WHILE WE’RE MORE CREDIT FOCUSED, WE THINK IT’S COMPETITIVE ADVANTAGE. WE SPENT A LOT OF TIME ON UNDERWRITING AND DATA, AND DATA SITS AT THE CORE. MY COFOUNDER FOUNDED CAPITAL ONE AND THAT WAS MR. WIG THING, THE USE OF DATA FOR BETTER CREDIT UNDERWRITING. I THINK YOU’LL SEE THAT THE MARKET, WHILE FROM A SORT OF CONSUMER ENTRY POINT HAS SENSIBLY STARTED WITH CURRENT ACCOUNT, WILL — A LOT OF PLAYERS WILL BE MOVING INCREASINGLY TOWARDS CREDIT OVER THE COURSE OF THE NEXT FEW YEARS.>>I THINK WE HAVE A SLIGHTLY DIFFERENT PERSPECTIVE, YEAH? I THINK WE SEE THAT MOST OF THE BANKS REDUCE THEMSELVES TO CREDIT. I THINK IN THE END IT’S ALL ABOUT THE DAIL RECURRENCE. WE SEE N-26 AS THE OPPORTUNITY OF BEING AN APP THAT IS OPEN DAILY. THAT’S ALREADY TODAY PEOPLE USING, OPEN OUR APRIL DAILY. IF YOU THINK ABOUT HOW MANY APPS ON A SMARTPHONE YOU ARE ACTUALLY OPENING DAILY, IT’S NOT TOO MANY. MAYBE FOUR OR FIVE. I THINK AS A FUTURE BANK YOU NEED TO BE A PROBLEM SOLVER. CREDIT IS ONLY ONE PROBLEM. THERE ARE OTHER PROBLEMS. YOU HAVE SUBSCRIPTIONS ON YOUR ACCOUNT, MAYBE YOU’RE PAYING TOO MUCH. THERE IS MAYBE — YOU BOOK A VERY RISKY ACTIVITY. MAYBE YOU WANT TO GET ACCIDENT INSURANCE FOR FOUR DAYS. SO I THINK MOST OF THE BANKS LIMITING THEMSELVES TO FINANCIAL PROBLEMS, WHERE BASED ON THE TRUST OF THE CONSUMER AND THE DATA SET THAT YOU HAVE, AND ALSO THE CLOSENESS OF BEING ABLE TO PAY FOR A NEW PRODUCT QUICKLY WITH ONE TAP. I THINK THINGS WHERE A BANK, IF YOU BUILD A GREAT BRAND, CAN SOLVE MANY MORE PROBLEMS FOR CUSTOMERS THAN ONLY THE CREDIT PROBLEM. AND I THINK IF I THINK ABOUT THE WHOLE INDUSTRY, I THINK IN LIKE THE NEXT FIVE TO TEN YEARS, I THINK YOU WILL HAVE CERTAIN PLAYERS THAT REALLY SPECIALIZE INTO NICHE PRODUCTS. MAYBE CREDIT, MAYBE SAVINGS PRODUCTS. THEN OTHER PLAYERS –>>LIKE YOU?>>MAYBE US, YEAH. I THINK WE HAVE A SHOT TO BE THAT. THAT ARE OPEN DAILY WHERE THE DECISIONS ARE TAKEN. BOTH WAYS. I THINK TRADITIONAL BANKS MORE IN THE — HAVING A SPECIAL PRODUCT, HAVING A HUGE BALANCE SHEET, MAYBE GETTING A BETTER PRICE ON SOME OF THE PRODUCTS, BUT THEY WILL BE INTEGRATED I THINK INTO THE PLATFORMS THAT ARE COMMONLY USED. I THINK WITH N-26 OUR BUSINESS IS REALLY TO BUILD AN APP, TO OPEN DAILY, BECAUSE IT SOLVES YOUR PROBLEMS. I THINK THAT’S HOW WE THINK ABOUT THE WHOLE THING. NOT SO MUCH ABOUT THE FINANCIAL PRODUCTS. >>YOU DON’T GENERATE REVENUE FROM SOMEONE OPENING THE APP. DO YOU THINK YOU’RE FOCUSING ON REVENUE NOW ENOUGH OR DO YOU THINK IT’S GOING TO COME DOWN THE ROAD?>>WHAT WE HAVE SEEN, ACTUALLY, WE’VE BUILT A TRADITIONAL BANKING PRODUCT FROM A SENSE, REPLACING A TRADITIONAL BANK ACCOUNT. AS A SUBSCRIPTION BUSINESS AND DAILY RECURENCE, SO ALL OUR REVENUES ARE COMING FROM HOW OFTEN DO YOU USE OUR CARD? HOW OFTEN DO YOU INTERACT WITH US? AND OUR VIEW, WE’LL NEED TO DO ALL THESE COMPLEX FINANCIAL PRODUCTS AND HAVE A BIG BALANCE SHEET TO BE MUCH MORE PROFITABLE THAN THEY ARE. I THINK THAT’S THE KEY. AND I THINK THE MORE ENGAGEMENT YOU HAVE, THE MORE PROBLEM SOLVING OPPORTUNITY YOU HAVE, AND IF YOU SOLVE PROBLEMS FOR CUSTOMERS THEN YOU NATURALLY CAN BUILD REVENUE STREAMS OUT OF THAT. WE’VE BEEN DOING THE LAST TWO YEARS, AND I THINK IN THE NEXT TWO TO THREE YEARS I THINK WE’LL CONTINUE TO DO THAT.>>YEAH, TO BE CLEAR, I COMPLETELY AGREE ON THE ENGAGEMENT FRONT. SO FOR EXAMPLE, OUR CARD AND APP USERS ARE 90% WEEKLY ACTIVE, SIX MONTHS AFTER COMING ON BOOK. THAT EXCLUDES PEOPLE THAT DON’T ACTUALLY ACTIVATE. THAT INCLUDES ALL ACTIVATED USERS WHICH IS SUPER HIGH. SO THESE GUYS ARE — ONCE YOU START, THEY KEEP USING IT. ALSO THEY CONTINUE ACTIVE AND ARE AVERAGE OPEN RIGHT NOW AT 1.2 PER DAY FOR THAT SEGMENT. SO IT’S LIKE WE’RE AT A SUPER, SUPER HIGH ACTIVE DAILY USAGE. AND I THINK THAT IS REALLY IMPORTANT. I THINK — AND, YOU KNOW, I THINK IT’S ALWAYS TWO PERSPECTIVES TO A BUSINESS. THERE’S THE CONSUMER PERSPECTIVE, WHICH THAT’S ABSOLUTELY RIGHT, AND FOR TOO LONG THE BIG BANKS HAVE BEEN SUPER FOCUSED ON THE BACK END OF THE BUSINESS AND NOT ENOUGH FOCUSED ON THE FRONT END OF THE BUSINESS. BUT THERE IS A QUESTION — THERE’S A BIG THING GOING ON IN THE UK, MARKETPLACE BANKING, PARTICULARLY STARLING IN THE UK HAS SET OUT, I THINK THEY’RE ON STAGE LATER TODAY, REALLY SET OUT THEIR STOOL AS MARKETPLACE BANKING. THE INTERESTING THING THAT WE FOUND WITH REAL EXPERIENCE — WE’VE GOT 72 NUDGES THAT CAN BRING PEOPLE INTO A DISCUSSION ABOUT EITHER MONEY THEY CAN SAVE, THEY’VE GOT TWO SUBSCRIPTIONS, THEY’VE GOT — MIGHT WANT INSURANCE, ALL THIS OTHER STUFF. WHAT WE’VE FOUND IS THE MORE WE TRY AND PUSH REVENUE IN THAT AREA, THE LESS CUSTOMERS LOVE IT. SO THE CHALLENGE WITH MARKETPLACE IS IF YOU BUILD YOUR BUSINESS MODEL AROUND IT, YOU’VE GOT INHERENT CONTRADICTION BETWEEN CUSTOMERS LOVING YOU LESS WHEN YOU MAKE MORE MONEY. AND SO I THINK THERE’S A REALLY INTERESTING — THAT SOMEWHAT INFORMS OUR CREDIT PERSPECTIVE, WHICH IS, WE WANT TO JUST DO THE BEST JOB FOR CONSUMERS. WHICH OFTEN FOR US MEANS MAKING NO MONEY IN THOSE INTERACTIONS. BECAUSE IF WE SELL FREE PRODUCT OR IF WE’RE DOING THINGS WHERE WE’RE FINDING THE BEST PRICE, THEN WE ACTUALLY GET MORE CUSTOMER RESPONSE TO THAT FRONT END. THE BACK END, WE’RE STILL MAKING MONEY THE SAME WAY A BANK MAKES MONEY. WE’RE ABLE TO FUND, IF YOU LIKE, ALL THIS GREAT CUSTOMER STUFF AT THE FRONT END. IT IS A DIFFERENT PERSPECTIVE BUT I THINK IT’S INTERESTING DIFFERENTIATION. >>I SAW YOU WERE SAYING NO WITH YOUR HEAD. >>YEAH. BECAUSE I DON’T THINK THAT IT’S — I THINK WHAT WE SEE WITH OUR CUSTOMERS, IF WE HAVE A GREAT PRODUCT, THEY’RE NORMALLY WILLING TO PAY A LITTLE BIT FOR IT. IT NEEDS TO BE TRANSPARENT, IT NEEDS TO BE A GOOD VALUE TO CONSUMERS. I THINK IT’S UNTRUE THAT CUSTOMERS ARE ALWAYS NOT CHOOSING A PRODUCT IF YOU PRICE IT. SO I THINK THAT’S A LEARNING FOR US. I THINK MAYBE ONE MORE THING ARE WHAT WE HAVE FOCUSED ON IS ON PRODUCTS THAT HAVE A LOWER OR A SHORTER REPURCHASING CYCLE. SO IF YOU THINK ABOUT THE MORTGAGE, FOR EXAMPLE, WE MIGHT BE DOING THAT AT SOME POINT –>>YOU DO ALREADY, YEAH. >>BUT THE REPURCHASING CYCLE IS MAYBE, YOU KNOW, YOU NEED A MORTGAGE EVERY FIVE YEARS. BUT IF YOU REALLY WANT TO BUILD LIKE A VARIABLE, IF YOU WANT PEOPLE TALKING ABOUT IT, YOU NEED TO FOCUS ON THE PRODUCTS THAT THEY CHOOSE MAYBE WEEKLY, MAYBE DAILY. THAT’S ABOUT WHAT WE FOCUS ON. I THINK ONE PRODUCT THAT IS GOING TO BE CREATED COMING IN THE FIRST QUARTER IS YOU WILL BE MUCH MORE ABLE TO SHARE ACCOUNTS. SHARE THEM WITH FRIENDS, BE ABLE TO INVITE FRIENDS TO USE ACCOUNTS TOGETHER. WE HAVE MUCH MORE THINKING ABOUT HOW WE CAN IMPROVE DAILY FINANCIAL INTERACTIONS IN TERMS OF MANAGING YOUR FINANCES, SHARING IT WITH FRIENDS, HAVING A SHARED ACCOUNT. I THINK THAT’S WHERE WE’VE SEEN, IF WE DO THAT, THERE’S A LOT OF VARIABILITY AROUND IT. IT CREATES A LOT OF LOYALTY TO US. WE SOLVE REAL PROBLEMS FOR OUR PEOPLE.>>VERY TRUE. SHARED ACCOUNTS COMING SOON. >>YEAH, THAT’S SOMETHING, FOR EXAMPLE, IN THE UK, MONZA’S DONE A GREAT JOB OF, TO TALK ABOUT OUR COMPETITORS. THEY’VE REALLY FOCUSED PRETTY MUCH ON SOLVING YOUR PROBLEM AND FOR CUSTOMER ACQUISITION REASONS, WHICH HAS BEEN SUPER EFFECTIVE FOR THEM. OBVIOUSLY THEY’VE GOT JUST OVER 1 MILLION CUSTOMERS, SMALLER THAN YOU GUYS, BUT IN ONE MARKET RATHER THAN MANY. IT IS A MATTER OF FOCUS. YOU’RE HEARING DIFFERENT LEVELS OF FOCUS. YOU’RE PRIMARILY FOCUSED ON ENGAGEMENT, THEY PRIMARILY FOCUSED ON VARIABILITY, WE FOCUSED ON CREDIT AND REVENUE AS WELL. WE’RE TAKING 45 POUND PER USER PER YEAR ON AVERAGE, ACROSS OUR –>>MORE THAN FACEBOOK. >>YEAH, WELL. THE AVERAGE BANK MAKES MORE LIKE 250 POUNDS PER USER PER YEAR, WE’RE ALREADY DOING 45. >>I THINK WHAT IS ALSO IMPORTANT, FOR US ONE NUMBER THAT I BROUGHT FOR TECH CRUNCH TODAY, I THINK TODAY WE — WE WERE TALKING ABOUT THE LAST NUMBER, 1.5 MILLION CUSTOMERS. >>NUMBERS, I LOVE NUMBERS. >>I KNOW, THAT’S WHY I BROUGHT SOME. AND THEN WE NOW HAVE MORE THAN 2 MILLION CUSTOMERS ALREADY. >>WOW. >>WE HAVE MORE THAN 1.5 BILLION EUROS IN TRANSACTION VOLUME A MONTH. NEXT YEAR WILL BE FAR BEYOND, LIKE 20 BILLION EUROS IN TRANSACTION VOLUME IN A YEAR. AND ALSO WE HAVE MORE THAN 1 BILLION EUROS DEPOSITS. THAT’S IMPORTANT. SO THE DEPOSIT NUMBER ALSO SHOWS, A LITTLE BIT AT LEAST, HOW PEOPLE — IT’S NOT EVERYTHING BUT IT’S A LITTLE BIT OF A NUMBER THAT SHOWS THAT PEOPLE ALSO PUT MONEY THERE AND USE IT AS A REAL BANK ACCOUNT. THAT COMBINED WITH STICKY CUSTOMERS HAS BEEN TREMENDOUS FOR US. AND FOR THE UK ESPECIALLY, WE’VE LAUNCHED LAST MONDAY IN THE UK, AND IT HAS BEEN ACTUALLY A VERY COOL MARKET. BECAUSE ALWAYS YOU ENTER A MARKET, THERE IS SOME QUESTION MARKS. A LITTLE BIT MORE PLAYERS OUT THERE, SO ON. WE’VE LAUNCHED, IT’S ONE OF THE MOST SUCCESSFUL LAUNCHES WE’VE HAD, N-26. IF I COMPARE IT TO THE FRENCH MARKET, FOR EXAMPLE, THE FRENCH MARKET IS ONE OF THE MOST IMPORTANT MARKETS. BUT –>>THAT WAS THREE YEARS AGO. >>THREE YEARS AGO WHEN WE LAUNCHED IT THERE. IF YOU LOOK AT THE PICKUP IN THE UK IN THE FIRST WEEK, IT’S EVEN MUCH STRONGER THAN IN THE FRENCH MARKET. THE FRENCH MARKET IS ONE OF THE MOST IMPORTANT ONES FOR US TODAY.>>HOW MANY DO YOU HAVE IN THE UK?>>IN THE UK I THINK — I DON’T KNOW THE EXACT NUMBER TODAY. I THINK YES, WE’RE GOING WITH AROUND 1,500 TO 2,000 CUSTOMERS ON THAT SINGLE DAY. AND WE’VE SEEN LIKE THREE DAYS AGO, IT WAS THOUSANDS. SO I THINK IT’S A GREAT GROWTH THAT WE’RE SEEING. AND YEAH, WE HAVE A CUP OF — 10,000 ACCOUNTS NOW AFTER THE FIRST WEEK. I THINK THAT’S GREAT. >>WHAT ABOUT TANDEM? HOW MANY USERS DO YOU HAVE?>>JUST UNDER 500,000 IN THE UK. I THINK THE INTERESTING THING IS WE LAUNCHED IN JANUARY. SO THAT’S OBVIOUSLY A PRETTY RAPID GROWTH RATE. AND ACTUALLY WHAT WE’RE SEEING, WHICH IS SUPER INTERESTING, IS THAT ACTUALLY I KNOW LAST YEAR, MONZO IS GROWING VERY QUICKLY. WE WEREN’T IN THE MARKET. STARLING WAS GROWING VERY SLOWLY. NOT REALLY RELEVANT FROM A UK PERSPECTIVE, N-26 WASN’T THERE. THIS YEAR EVERYBODY’S GROWING REALLY QUICKLY. IT’S AN ODD PHENOMENON. OBVIOUSLY WE ARE SEEING QUITE A LOT OF OVERLAP SO WE ALLOW YOU TO AGGREGATE YOUR DIFFERENT ACCOUNTS. WE DON’T YET AGGREGATE AN N-26 ACCOUNT, WE SHOULD CHAT ABOUT THAT. YOU CAN SEE YOUR MONEY ZO ACCOUNT INSIDE YOUR TANDEM ACCOUNT. WE CAN SEE QUITE A LOT OF USERS ARE MULTI-ACCOUNTING AT THE MOMENT. WHAT WE’RE ALSO SEEING IS EARLY SIGNS OF PEOPLE PICKING A HORSE. SO WHAT TENDS TO HAPPEN, PARTICULARLY WITH THE EARLY ADOPTER AUDIENCES, THEY WILL OPEN AN ACCOUNT WITH EVERYBODY. THEY WANT TO CHECK IT OUT, THEY WANT TO GET THE BEST PRODUCT. WHAT YOU’LL SEE IS OVER TIME THEM KIND OF PICKING A HORSE, DEPENDING ON THE FUNCTIONALITY THEY LIKE, DEPENDING ON THE SERVICE THEY’RE GETTING THERE, SETTLING IN. THAT HAPPENS FURTHER DOWN THE ROAD. >>I ALSO THINK THIS IS MORE FOR THE EARLY ADOPTERS. I THINK WHAT WE’VE SEEN, ESPECIALLY IN THE MARKETS THAT WE’RE IN NOW FOR LONGER, YOU OBVIOUSLY HAVE A TECH COMMUNITY, MAYBE MOST OF THE PEOPLE IN THE AUDIENCE CHECK OUT MORE PRODUCTS, COMPARE THEM. I THINK WHAT YOU NEED TO UNDERSTAND FOR THE UK IS THAT MORE THAN 98% OF THE PEOPLE ARE BANKING WITH A TRADITIONAL BANK. PAYING HIGH FEES, HAVING A BAD EXPERIENCE. IN THE UK ESPECIALLY, 60% OR 75% OF THE PEOPLE BANK WITH FOUR BANKS ONLY. FOUR BIG BANKS, 75% OF THE ACCOUNTS. IT NORMALLY LEADS TO HIGH PRICES, BAD EXPERIENCE, AND NOT A LOT OF CUSTOMER FOCUS. I THINK IN THE END WE’LL HAVE THE EARLY MAJORITY THAT ARE THE EARLY ADOPTERS THAT COMPARE MORE, AND IT’S ALSO FAIR. THEY NEED TO HAVE THE BEST PRODUCT. I THINK IN THE LONG RUN IT’S ABOUT TAPPING INTO THESE 60 MILLION CUSTOMERS OR MORE THAT ARE STILL BANKING WITH TRADITIONAL BANKS. DOESN’T MATTER IF YOU HAVE 6 MILLION KEARNS, WE HAVE 6 MILLION CUSTOMERS IN THE UK, SOMEONE ELSE HAS 6 MILLION CUSTOMERS, MAYBE 10 MORE MARKETS AROUND THE WORLD. I THINK THAT’S BRINGING US TO WHAT WE WANT TO BUILD, A COMPANY BETWEEN 50 MILLION AND 100 MILLION CUSTOMERS OVER THE NEXT FIVE TO TEN YEARS. >>IT’S INTERESTING THAT YOU ANNOUNCED THAT YOU WOULD LAUNCH IN HONG KONG AS WELL. MANY COMPANIES LAUNCH ACROSS EUROPE, IN THE U.S. WHY DID YOU CHOOSE HONG KONG? AND WHY DID YOU CHOOSE TO DO A PARTNERSHIP?>>YEAH, A COUPLE OF DIFFERENT PIECES. I MEAN, OWNS I SUPPOSE MOST IN THE AUDIENCE ARE AWARE, BUT CHINA IN PARTICULAR HAS BEEN ONE OF THE FASTEST MOVERS GLOBALLY IN TERMS OF DISRUPTION AND DISRUPTION IN BANKING. IT’S HAPPENED IN A VERY DIFFERENT WAY. ULTIMATELY THE TWO BIG TECH GIANTS WHICH BOTH STARTED FROM CHAT INTERFACES, FOR EXAMPLE, WE CHAT HAS MOVED INTO WE PAY AND THEN INTO WE BANK. NOW ACTUALLY BRINGS IN LIKE A REMARKABLE — LIKE IT’S NORTH OF 50% OF SHORT-TERM LENDING IN CHINA COMES IN THROUGH THAT ONE BANK. ACTUALLY THE GOVERNMENT TO RESELL THOSE LOANS ON TO THE RURAL BANKS, THEY’VE GOT LOTS OF SAVINGS THERE BUT THEY HAVEN’T ACTUALLY GOT A LOT OF LENDING. WHAT THEY’VE COME IN IS COME IN VIA PAYMENTS ROUTE BUT FROM CHAT, RATHER THAN COMING IN FROM A CURRENTPERSPECTIVE. ONE OF THE EXCITING THINGS IS THERE ARE MASSIVE ASIAN MARKETS. MY PREVIOUS TWO BUSINESSES WERE BOTH PAYMENTS BUSINESSES, BOTH WORKING IN THE DEVELOPING WORLD. ASMO AND SMALL FINANCIAL SERVICES ARE AND THERE IS — OKAY, IT’S ALL VERY WELL TO LOOK AT EUROPE AND THE U.S. WHICH CERTAINLY IF YOU’RE LOOKING FOR U.S. VCs, GOING TO THE U.S. HAS ALWAYS BEEN A GOOD TRICK BECAUSE THE U.S. ARE AMAZINGLY SHORT SIGHTED ABOUT ACTUALLY GOING AND INVESTING OUTSIDE THE U.S. SOME OF THEM HAVE OPENED EUROPEAN OFFICES EVEN HERE IN BERLIN BUT THAT’S A SMALL CADRE. AND THE EXCITING THING HERE IS THE OPPORTUNITY, AS I SAID, FOR A GLOBAL BANK AND SOME OF THESE ASIAN MARKS ARE REALLY RIPE FOR DIS-RUSSIAN. >>OKAY. ONE LAST QUICK QUESTION. DO YOU THINK WE’RE GOING TO SEE SOME SORT OF CONSOLIDATION IN THE MARKET? LET’S SAY YOU LAUNCH ALL OVER ASIA AND N-26 LAUNCHES IN THE U.S. ARE YOU GOING TO WORK TOGETHER AT SOME POINT, FOR INSTANCE?>>I MEAN, THE TRUTH IS YOU LOOK AT THE GLOBAL BANKING MARKET AND THERE ARE, YOU KNOW, HUNDREDS OF HUGE BANKERS NOW. EVEN IN THE UK MARKET YOU MENTIONED FOUR SIMILAR PLAYERS. I’D SAY THERE’S PLENTY OF ROOM FOR THE EXISTING CADRE OF NEAR BANKS TO BE INCREDIBLY SUCCESSFUL ON A GLOBAL BASIS WITHOUT ANY MERGERS AND ACQUISITIONS. I THINK WHAT YOU WILL SEE PROBABLY, NOT NOW BUT IN THREE, FIVE YEARS’ TIME, BIG OFFERS GOING DOWN THE TABLE FROM TRADITIONAL BANKS TRYING TO BUY INTO THESE GUYS. I THINK YOU’LL FIND SOME PEOPLE, PARTICULARLY US, I WOULD SAY THAT’S NOT A ROUTE WE WANT TO TAKE. HOWEVER, THERE ARE OTHER PLAYERS OUT THERE WHO I THINK WILL BE OPEN TO SOME LARGE VALUATIONS AND TAKING MONEY OFF THE TABLE. I THINK IT’S LESS LIKELY THAT YOU SEE — TELL ME IF I’M WRONG — AN N-26 –>>I THINK THERE’S A COUPLE OF PLAYERS SET FOR BEING A GLOBAL BANK. I THINK WE TRY AND TAKE THE SHOT TO BE A GLOBAL BANK. I THINK IT’S ABOUT BUILDING UP 50 TO 100 MILLION USERS IN THE NEXT COUPLE OF YEARS. >>ARE YOU GOING TO GET ACQUIRED BY DEUTSCHE BANK? YES OR NO?>>NO. >>ALL RIGHT. THANK YOU VERY MUCH.>>THANKS, GUYS.>>THANK YOU.>>THANK YOU. ALL RIGHT, IF YOU WANT TO DIG A LITTLE DEEPER INTO THE FINTECH SCENE, RICKY IS GOING TO BE ON THE Q&A STAGE AT 11:30 A.M. SO GO AHEAD OVER THERE AND HANG OUT WITH HIM A LITTLE BIT. IF NOT WE’RE GOING TO GET INTO LANGUAGE LEARNING. ONE OF THE BEST SUCCESSORRIES OUT OF THE U.N. TECH SCENE IS BABBLE. THEY’RE MOVING INTO THE U.S. WHICH BRINGS ABOUT ALL KINDS OF NEW CHALLENGES. PLEASE WELCOME TO THE STAGE MARCUS WITT AND JULIE HANSEN. CLAPPING WON’T KILL YOU. THERE WE GO.>>THANK YOU. GOOD MORNING. >>GOOD MORNING. >>WE’RE GOING TO LEARN SOME LANGUAGES TODAY.>>TEACH ME SOMETHING.>>TODAY, BABBLE IS PRETTY MUCH THE TOP-GROSSING LANGUAGE PP IN EVERY STORE. YOU’VE BEEN AROUND 10, 11 YEARS DEPENDING WHO I ASK. IN THE BEGINNING, TELL US ABOUT\THAT. >>SO WE’RE DEFINITELY IN A GOOD PLACE TODAY, I’D SAY. JUST STARTING TO BE REALLY GREAT. BUT WHEN WE STARTED OFF IN 2007, A LANGUAGE LEARNING WEBSITE, THAT WAS PRE APP STORE. WE WERE BASICALLY FOUR ARROGANT TECH GUYS THINKING, OH, THIS IS A TECH PROBLEM. THIS IS A PRODUCT PROBLEM. LANGUAGE LEARNING IS PRETTY MUCH SOLVED, HOW HARD CAN IT BE? THE BEGINNING WAS ACTUALLY EASY. SO THE DAY WE LAUNCHED, THE FIRST BETA, WE GOT A TECH GRUNGE WHICH WAS AMAZINGLY IMPACTFUL. >>AWESOME. STILL HELPS TODAY.>>YEAH. YES, I KNOW. >>I DO KNOW THAT.>>BUT BACK THEN IT MADE A TON OF DIFFERENCE. SO WE GOT QUITE SOME INTEREST, QUITE SOME TRACTION. BUT WE FOUND OUT VERY QUICKLY THAT YOU COULDN’T LEARN A LANGUAGE WITH THE THING THAT WE HAD BUILT.>>WHAT WAS THE THING YOU HAD BUILT AT THE TIME?>>IT WAS BASICALLY A VOCAB TRAINER. WE LOOKED AT PRODUCTS THAT WERE AVAILABLE AT THE TIME AND MADE IT A LITTLE NICER AND ONLINE. A LITTLE MORE MODERN. BUT THAT DIDN’T CUT IT AT ALL. SO AFTER A TIME WE FOUND OUT, NUMBER ONE, YOU DON’T LEARN A LANGUAGE WITH THIS. NUMBER TWO, YOU WILL NEVER MAKE MONEY WITH IT. COMBINATION OF BOTH DIDN’T FEEL LIKE, YEAH, WE’RE ON TO THE NEXT BIG THING. >>WHY WOULD YOU NEVER MAKE MONEY WITH IT?>>BECAUSE IT’S VERY HARD TO MAKE MONEY WITH A FREE PRODUCT. SO WE STARTED OUT WITHOUT CHARGING. AND WE HAD THE IDEA OF EVENTUALLY SELLING ADS. BUT WITH AN UNSOLVED VALUE PROPOSITION FOR THE USER. IT’S REALLY HARD IF YOUR CUSTOMER IS NOT YOUR USER. OVER TIME THAT DAUPED ON US. WE WENT THROUGH A BRUTAL LEARNING CURVE. ALMOST WENT BUST IN THAT TIME. SO WE JUST NEEDED TO DO TWO THINGS BUT WE DIDN’T KNOW WHAT THEY WERE. IT TURNED OUT NUMBER ONE WAS GETTING THE TALENT ON BOARD. PEOPLE WHO ACTUALLY KNOW HOW YOU LEARN A LANGUAGE. AND TO OUR SURPRISE, THERE’S PRETTY GOOD RESEARCH ABOUT THAT AND PRETTY GOOD KNOWLEDGE THAT WE DIDN’T HAVE YET. AND NUMBER TWO IS THE CUSTOMER AND THE LERNER NEED TO BE THE SAME PERSON. IF YOU TRY TO MONETIZE FROM SOMEBODY ELSE, IT’S VERY, VERY HARD TO BUILD A GOOD PRODUCT FOR THE ACTUAL LERNER. SO WE LEARNED THAT IN A VERY, VERY ROUGH WAY.>>SO YOU DECIDED TO CHARGE. >>OH, YES, WE DID. WE NEVER PROMISED THAT THE PRODUCT WOULD BE FREE. WE JUST DIDN’T CHARGE IN THE BEGINNING. IT STILL WAS PAINFUL TO TURN AROUND. SO WHAT WE BASICALLY DID IS WE RECREATED A PRODUCT, THE PRODUCT FROM SCRATCH, AND WE BASICALLY LAUNCHED SOMETHING NEW AND THEN SAID, OKAY, FOR THIS NEW PRODUCT, BECAUSE IT HAS A DIFFERENT LEVEL OF QUALITY, WE’RE ACTUALLY CHARGING. IT WAS NOT A CROSS-OVER OR PREMIUM OR WHATEVER. IT WAS CLEAR. IF YOU WANT TO USE IT, IT’S SOMETHING YOU HAVE TO PAY FOR. >>ABSOLUTELY. YOUR BIGGEST COMPETITOR IS DUO LINGO IN THE LANGUAGE LEARNING SPACE. DO YOU AGREE?>>YEAH, KIND OF. IT’S ONE OF THE BIG COMPETITORS, DEFINITELY, YES. >>THEY’RE FREE.>>YEAH. AND THAT’S THEIR PROBLEM. THAT’S FORTUNATELY NOT OURS. >>YOU SAY IT’S A PROBLEM. >>WELL, WE’VE BEEN THERE. AGAIN, IT’S VERY, VERY HARD TO MAKE MONEY WITH A FREE PRODUCT. AND MAKE MONEY IS NOT BECOMING FILTHY RICH, IT’S PAYING YOUR FREAKING BILLS AND MAKING SURE THAT YOUR PEOPLE GET THEIR BILLS PAID. SO THAT’S REALLY HARD. AND THEN FROM A USER PERSPECTIVE, IT’S ALSO YOU’RE WORKING WITH A PARTNER WHO DOESN’T MAKE MONEY WITH YOU AND NEEDS TO MONETIZE SOMEWHERE ELSE. SO THERE’S A TRUST ISSUE. THERE’S A QUALITY ISSUE. SO I’M REALLY SKEPTICAL THAT THIS WORKS OUT.>>YOU SAY IT’S A QUALITY ISSUE. DUO LINGO ISN’T THAT GOOD?>>WELL, IT’S ALWAYS HARD TO SAY YOUR THE COMPETITION’S NOT THAT GOOD. BUT I THINK THEY’RE STILL IN THE PHASE THAT WE WERE IN BEFORE WHERE THEY THINK IT’S A TECH PROBLEM. AND IT IS NOT A TECH PROBLEM. LANGUAGE LEARNING IS A HUMAN PROBLEM. IT’S HUMAN LEARNING. IT’S NOT MACHINE LEARNING. >>RIGHT.>>WHICH THIS IS NOT ME SAYING MACHINE LEARNING DOESN’T CHANGE OUR WORLD. IT DOES. IT CHANGES LANGUAGE LEARNING. BUT THE PROBLEM IS NOT MACHINE LEARNING. AND TO GET BEHIND THAT WE HAVE HUNDREDS OF PEOPLE AT BABBLE WHO ARE LANGUAGE LEARNING EXPERTS AND HAVE EXPERIENCE IN THAT, AND THAT MAKES A DIFFERENCE, AND YOU NEED THAT. >>YOU SEEM TO BE DOING FINE THESE DAYS. YOU’VE GOT 700 PEOPLE. I THINK YOU JUST RENTED A GIANT BUILDING FOR 1,000-SOMETHING PEOPLE. YOU’RE DOING ALL RIGHT. ONE MARKET THAT ALWAYS VEXED YOU WAS THE U.S. >>YEAH. >>UNTIL YOU HIRED JULIE, NOW YOUR CEO FOR THE U.S. WHY WAS THE U.S. SO HARD TO CRACK? JULIE, YOU MIGHT WANT TO TAKE THAT ONE.>>WELL, I THINK IT WASN’T ONCE WE WENT ABOUT IT THE RIGHT WAY. BUT I THINK THE COMPANY STARTED IN A VERY DIFFERENT ORIENTATION.>>WHAT WAS THE WRONG WAY? TELL US ABOUT THAT FIRST. >>WELL, I REMEMBER HEARING THE FIRST MARKETING SLOGAN OF BABBLE IN EUROPE, WHICH WAS, YOU CAN LEARN A LANGUAGE ONLINE. AND EVERY TIME I TELL THAT TO AN AMERICAN THEY’RE LIKE, SO WHAT? IN AMERICA THAT’S NOT OUR CHALLENGE. I WANT TO LEARN A LANGUAGE, WHERE DO I DO IT? IT’S, OUR MARKETING CHALLENGE IS MORE SO TO CONVINCE PEOPLE, YOU SHOULD LEARN A LANGUAGE, YOU CAN DO IT, IT’S A WORTHWHILE THING TO DO. SO WE’RE TRYING TO STIMULATE DEMAND FOR LANGUAGE LEARNING RATHER THAN RESPOND TO IT. I THINK WE’RE GETTING THE MESSAGING RIGHT, THE POSITIONING RIGHT, UNDERSTANDING THAT AN AMERICAN AUDIENCE DOESN’T NECESSARILY NEED A LANGUAGE THE SAME WAY — A SECOND LANGUAGE THE SAME WAY YOU MIGHT NEED IT HERE OR ELSEWHERE AND UNDERSTANDING THAT, IN FACT, MOST OF AMERICA DOES NOT STUDY A LANGUAGE, EVER, IN SCHOOL. THE MAJORITY DO NOT DO THAT. SO THEY’RE NOT COMING FROM A PLACE WHERE THEY’RE USED TO LANGUAGE LEARNING, SO WE’RE STARTING — IT’S JUST VERY DIFFERENT ORIENTATION. WE HAD TO GET THAT RIGHT FIRST. >>ABSOLUTELY. IN EUROPE THAT’S NOT THAT MUCH OF A PROBLEM FOR YOU. WHO ARE YOUR USERS IN EUROPE? MAYBE COMPARE THOSE TO YOUR USERS IN THE U.S. TODAY?>>I WOULD SAY IN EUROPE IT’S A LOT MORE THAT LANGUAGE LEARNING MAKES SENSE. AND WE HAVE STILL THE INTENT, SO THE ACTUAL DEMAND THAT’S OUT THERE CORRELATES STRONGLY WITH THE LANGUAGES SPOKEN IN THE COUNTRY. SWITZERLAND IS THE BEST COUNTRY FOR TOUSLE INTO, NOT ONLY BECAUSE SWITZERLAND IS THE BEST COUNTRY TO SELL INTO PERIOD, BUT ALSO BECAUSE THEY SPEAK A LOT OF LANGUAGES. AND THEY’RE USED TO THE FACT THAT YOU LEARN LANGUAGES AND IT’S WORTHWHILE. SO THAT’S — THOSE ARE THE EASY MARKETS. THE HARD MARKETS ARE MARKETS LIKE THE U.S. WHERE THE MESSAGE IS ALSO — NEEDS TO GET PEOPLE INTO THAT AND GET — CONVEY THE MEANING AND THE NECESSITY OF LANGUAGE LEARNING. >>RIGHT.>>SO I THINK THAT’S A BIG DIFFERENCE. IN TERMS OF AUDIENCE, I WOULD SAY HERE WE MIGHT SKEW A LITTLE OLDER IN AUDIENCE IN GENERAL. AND IN TERMS OF DEMOGRAPHY, ALSO HERE WE HAVE MORE TRAVEL. SO YOU HAVE PEOPLE GOING TO ITALY FOR TWO WEEKS, AND WHEN THEY COME BACK THEY WANT TO LEARN ITALIAN. >>RIGHT. >>THAT’S AN INTERESTING THING, BY THE WAY. THEY DON’T LEARN BEFORE THEY GO, THEY LEARN WHEN THEY COME BACK. >>SURE. I WOULD ASSUME IN THE U.S. YOU GET A SIMILAR MARKET, THOUGH. PEOPLE WHO TRAVEL TO EUROPE AND THEN WANT TO LEARN A LANGUAGE AS WELL, RIGHT?>>FOR SURE. TRAVEL IS DEFINITELY ONE OF THE KEY MOTIVATIONS. AND IT’S SOME DEGREE OF TRAVEL — OF LEARNING AFTER, BUT THERE’S VERY MUCH — I’VE HEARD SO MANY TIMES FROM CONSUMERS, I’M GOING TO, FILL IN THE BLANK, IN THREE MONTHS AND I’M GOING TO GET READY WITH BABBLE. THAT’S A VERY COMMON AMERICAN MOTIVATION. BUT I HAVE ANOTHER EXAMPLE FOR YOU WHY IT’S DIFFERENT. THIS IS ACTUALLY VERY TIMELY. THIS WEEK WE WERE FEATURED ON THE “TODAY” SHOW, WHICH IS THE BIGGEST MORNING SHOW IN THE U.S.>>YOU WOULDN’T THINK SO, BECAUSE WHO WATCHES TV STILL? BUT PLENTY OF PEOPLE DO. >>A LOT OF PEOPLE DO. 4 MILLION EVERY DAY. AND THE HOST USED BABBLE. HE TRIED TO LEARN ITALIAN. HE WENT TO AN ITALIAN RESTAURANT AND DIDN’T DO THAT WELL WITH HIS ITALIAN. BUT IT WAS FUN AND FUNNY AND THE HOST SAID, I LIKED USING BABBLE, IT WAS FUN. AND I CAME TO THE OFFICE LIKE, WHOO-HOO, VICTORY, THIS IS AWESOME! MY COLLEAGUES WERE LIKE, WHAT? WHY IS IT EXCITING THAT BABBLE WAS CALLED FUN? IN THE AMERICAN MARKET, THE IDEA THAT LEARNING A LANGUAGE ISN’T INTIMIDATING AND SCARY, BUT COULD ACTUALLY BE FUN, THAT’S HUGE. >>HOW MUCH DID THAT REPORTER LEARN?>>HE LEARNED SOME ITALIAN. I MEAN, HE WAS AT IT FOR A WEEK AND CHANGE. SO YOU’RE NOT GOING TO BE FLUENT AT THAT POINT IN TIME.>>THAT WOULD BE NICE.>>EARLY ON YOU MENTIONED YOU HAVE TO STIMULATE DEMAND, BASICALLY, IN THE U.S. HOW DO YOU DO THAT? AND MAYBE YOU CAN GENERALIZE A LITTLE BIT FOR THE REST OF THE MARKET AS WELL.>>WELL, YOU KNOW, THROUGH PRODUCTION.OF COURSE. WE HAVE A FABULOUS BLOG CALLED THE BASEBALL MAGAZINE AND WE REALLY GO FROM, AS I LIKE TO CALL IT, FROM “THE NEW YORKER” TO BUZZFEED IN TERMS OF THE CONTENT. TRAVEL, CULTURE, A LOT OF WORD NERD STUFF. IT’S ALL ABOUT HELPING OUR POTENTIAL AUDIENCE UNDERSTAND THAT LANGUAGE LEARNING IS REWARDING AND APPROACHABLE.>>NOW, WE TALKED ABOUT TRAVEL A LITTLE BIT. I KNOW YOU GUYS ACQUIRED A COMPANY HERE IN BERLIN. I THINK THAT’S NEWS. TELL ME ABOUT BABBLE AND TRAVEL. WHAT’S YOUR PLAN THERE?>>SO THE PLAN IS DEFINITELY TO OFFER MORE TO OUR LEARNERS. SO SOME TIME AGO WE UNDERSTOOD THAT PEOPLE LEARNING WITH US DON’T USE THE APP ALONE. THEY VERY OFTEN USE OTHER MEANS OF LEARNING. AFTER WE GOT OVER THAT PHASE WHERE WE WERE JEALOUS AND THOUGHT, WHY ARE WE NOT GOOD ENOUGH, WHAT DO THEY HAVE THAT WE DON’T HAVE –>>WHO WERE YOU JEALOUS OF?>>EVERYBODY ELSE, OF COURSE. WE UNDERSTOOD THAT WE WILL — AS AN APP WE’LL NEVER BE ABLE TO COMPETE WITH HUMANS. IN LANGUAGE LEARNING IT’S ABOUT HUMANS. IF YOU CAN GET FACE TIME WITH SOMEBODY — I SAY THAT AS SOMEBODY WHO LIVES OFF APPS. BUT HOW CAN WE MAKE THAT EASIER, WAS OUR QUESTION. SO IF YOU WANT TO BOOK LANGUAGE TRAVEL, IT STILL FEELS LIKE THE GENERAL TRAVEL WORLD, BEFORE IT WAS DIGITAL. SO IT’S STILL PHONE CALLS, GOING TO TRAVEL AGENTS, LOOKING AT — IT’S OLD. AND I THINK WE CAN MAKE THAT A LOT EASIER. SO FROM A LERNER’S PERSPECTIVE, TO GO FROM USING THE APP TO USE LANGUAGE TRAVEL AS A USER, WE WANT JUST TO MAKE THAT AN EASY JOURNEY. AND MAKE IT MORE TRANSPARENT AND PUT IT IN FRONT OF PEOPLE A LITTLE MORE. AND ON THE OTHER HAND, OF COURSE I THINK THERE’S A LOT OF PEOPLE WHO WOULD PROFIT FROM IT AND WHO ARE NOT USING IT, BUT ALSO THE CURRENT MARKET IS ALREADY VERY, VERY BIG. >>SO TO DO THAT, YOU ACQUIRED LINGO VENTURA. >>LINGO VENTURA IS RIGHT, YES. >>SMALL STARTUP HERE IN BERLIN. THEY WEREN’T ABLE TO MAKE IT. WHY DO YOU THINK YOU CAN?>>WELL, THEY DID A PRETTY GOOD JOB IN THE FIRST LEG OF THE JOURNEY. SO IT ALLOWS US TO LEAPFROG WHERE WE TRY OUT A LOT OF THINGS. BUILD THE APP AND ALL THAT. GET SOME SCHOOLS LINED UP. I THINK IT’S VERY HARD TO DO THAT STANDALONE. BECAUSE LANGUAGE LEARNERS TODAY — ANYBODY WHO WANTS TO LEARN A LANGUAGE TURNS TO AN APP FIRST. AND WHATEVER OTHER MEANS OF LEARNING THEY USE, THEY STAY WITH THE APP. SO WE’RE ALWAYS GAME. AND FOR A SIDE — FOR A LANGUAGE TRAVEL SITE, IT’S VERY HARD TO ATTRACT THE USERS IN GREAT ENOUGH NUMBERS IF YOU DON’T HAVE THAT BRIDGE. SO PEOPLE ARE WITH US ANYWAYS. FROM THEIR PERSPECTIVE, IT MAKES A TON OF SENSE TO HAVE OTHER OPTIONS. AND FROM OUR PERSPECTIVE, THAT’S A BIG OPPORTUNITY.>>IN THE U.S., LANGUAGE TRAVEL — IT’S NOT REALLY A THING. ARE YOU GOING TO TRY TO MAKE IT A THING?>>IT’S NOT REALLY A THING YET. BUT THERE ARE — IT’S NOT NONEXISTENT EITHER. YOU KNOW — SO IN THAT SENSE IT’S ALMOST MORE RIPE FOR LINGO VENTURA’S HELP. BECAUSE WHAT DOES EXIST IS EXTREMELY FRAGMENTED AND HARD TO FIND. WE WILL TRY TO MAKE IT A THING, BUT FIRST WE’LL LET OUR COLLEAGUES IN BERLIN MAKE IT A BIGGER THING HERE. >>SO THAT’S YOUR FOCUS RIGHT NOW FOR LANGUAGE — IT HASN’T LAUNCHED YET, WE SHOULD STRESS THAT. >>LINGO VENTURA IS ONLINE. YOU CAN BOOK YOUR LANGUAGE TRAVEL THERE. AND WE’RE BOOSTING THAT A BIT. AND WE’RE STARTING TO BLEND THAT IN A LITTLE MORE. BUT OF COURSE THE ACTUAL INTEGRATION TAKES TIME. AND BEFORE YOU CAN SEE BABBLE IN IT, IT WILL TAKE A LITTLE. >>IS IT GOING TO BE PART OF THE BABBLE LANGUAGE LEARNING APP? OR WHAT’S THAT GOING TO LOOK LIKE? A FAMILY OF APPS?>>IN A WAY IT WILL BE ACCESSIBLE THROUGH THE APPS. BUT IT’S NOT THAT WE WANT TO MAKE THE APP A MARKETING TOOL FOR SOMETHING ELSE. THE APP IS THE APP. IT’S SOMETHING THAT YOU WANT — THAT YOU USE TO LEARN A LANGUAGE. AND THAT’S OUR CORE BUSINESS. SO YOU WILL PROBABLY HAVE OPTIONS WITHIN THE APP WHERE YOU CAN JUMP OVER TO LINGO VENTURA. BUT THAT’S NOT THE STRONGEST LINK. BECAUSE IF YOU ARE AT THE POINT WHERE YOU’RE INTERESTED IN IT, YOU WILL FIND IT.>>TALKING ABOUT THE U.S. MARKET FOR A SECOND AGAIN, IS THERE SOMETHING YOU GUYS LEARNED FROM THE U.S. TEAM THAT YOU’RE APPLYING TO EUROPE NOW?>>OH, YES. >>SOME ROUND TRIP HERE?>>YEAH, GOOD.>>ARE YOU SURPRISED?>>DID I SENSE SOME TENSION?>>NO, NO, NOT AT ALL. IT’S ACTUALLY COOL. WE ARE A LEARNING COMPANY, WE LOVE TO LEARN. AND IF WE CAN LEARN FROM OUR U.S. TEAM, THAT’S FABULOUS. WE DO — ESPECIALLY BECAUSE IF IT COMES TO MARKETING, THEN WHETHER WE LIKE IT OR NOT, THE U.S. IS AHEAD OF GERMANY. IT’S JUST MORE SOPHISTICATED, MORE AGGRESSIVE. IT’S JUST FURTHER DOWN THE DEVELOPMENT CURVE. >>I GIVE YOU AGGRESSIVE. MORE SOPHISTICATED?>>YES, YES. I WOULD DEFINITELY SAY SO. >>OKAY. >>NOT ON THE MESSAGING, NECESSARILY, BUT ON HOW YOU DO MARKETING, HOW YOU THINK ABOUT MARKETING, HOW YOU THINK ABOUT CREATING VALUE AND ALL THAT. I THINK IT’S MORE ADVANCED. >>OKAY. >>AND I THINK THAT HELPS. AND ALSO IN THE U.S., WE HAVE A SMALL TEAM, A SMALLER TEAM THAT HAS WAY MORE GRAVITY AND COHERENCE. SO JULIE CAN MOVE A LOT FASTER IN WHAT SHE DOES THAN WE CAN WITH CLOSE TO 700 PEOPLE IN BERLIN. AND WE CAN LEARN FROM THAT. SO SHE’S OUR AVANT-GARDE IN A LOT OF SENSES.>>GOOD. GOOD FOR YOU. >>OH, YEAH.>>HOW MANY PEOPLE ARE YOU IN THE U.S. NOW? YOU’VE GOT ONE OFFICE IN NEW YORK?>>WE HAVE ONE OFFICE. WE’RE ABOUT 3,000 IN NEW YORK, WHICH IS ABOUT TWICE WHAT IT WAS A YEAR AGO.>>AND THE U.S. IS BECOMING ONE OF YOUR BIGGER MARKETS EVEN WITH THE SMALL TEAM LIKE THAT?>>IT IS THE BIGGEST COUNTRY, THOUGH. >>BIGGEST COUNTRY. IT’S NOT BIGGER THAN EUROPE AS A WHOLE. >>NO. >>NOT YET.>>HOW MANY SUBSCRIBERS DO YOU HAVE IN EUROPE?>>A LOT.>>OKAY.>>AND WAY MORE THAN IN THE U.S.>>LIKE 2 MILLION, 3 MILLION? WHAT KIND OF — WHAT ARE WE LOOKING AT?>>A LOT.>>A LOT OF MILLIONS?>>QUITE A BUNCH. QUITE A BUNCH OF CUSTOMERS OUT THERE.>>WHAT ABOUT THE U.S.? DO YOU HAVE SOME NUMBERS YOU CAN SHARE THERE? HE’S NOT LISTENING. HE’S NOT HERE. JUST IGNORE HIM. >>NO, IT’S BEEN A VERY BIG — I MEAN, TWO SOLID YEARS OF VERY BIG GROWTH IN THE U.S. SO BY THE TIME THIS YEAR IS OVER, WE SHOULD HAVE SOLD 1 MILLION SUBSCRIPTIONS IN THE U.S. >>1 MILLION SUBSCRIPTIONS. AT AN AVERAGE PRICE OF?>>WELL, THE AVERAGE SUBSCRIPTION DURATION WE SELL IS THREE MONTHS. >>OKAY. >>SO THAT’S IN THE 30s. BUT THEN IT’S OBVIOUSLY A RE RENEWAL. >>RIGHT, GOT IT. HAVE YOU LEARNED — IN MOVING TO THE U.S., THERE’S OTHER MARKETS FOR YOU THAT YOU WANT TO GET INTO AS WELL. I KNOW YOU JUST GOT BACK FROM CHINA. IS THAT A MARKET YOU’RE LOOKING AT?>>WE’RE LOOKING AT IT. ARE WE GOING INTO CHINA ANY TIME SOON? I DON’T THINK SO. HOW MANY PURE PLAY DIGITAL COMPANIES ARE THERE? OUR CURRENT STRATEGY IS REALLY TO GO DEEPER INTO THE MARKETS THAT WE ARE ALREADY IN. AND LEVERAGE WHAT WE’VE BUILT. AND OFFER MORE TO OUR LEARNERS THAN SPREAD IT FURTHER. AND WE’RE GROWING IN THE CORE MARKETS. SO WE DON’T HAVE THE HUGE PRESSURE TO ADD NEXT COUNTRIES.>>SO YOU’RE SAYING YOU WANT TO OFFER MORE, YOU’VE GOT THE CORE APP, YOU’VE GOT TRAVEL. WHAT ELSE ARE YOU LOOKING AT? WHAT ELSE CAN YOU OFFER?>>WELL, THERE’S ONLINE TUTORING WHICH SEEMS TO BE A MARKET.>>THE MARKET NOBODY HAS REALLY CRACKED YET. >>CORRECT. SO THAT MAKES IT EVEN MORE INTERESTING. >>OKAY. YOU’RE PICKING THE TOUGH ONES. LANGUAGE TRAVEL, NOBODY HAS REALLY TRACKED. TUTORING, NOBODY HAS CRACKED. >>YES, BECAUSE I THINK A PROBLEM THERE IS TO CRACK IT AS A STANDALONE PRODUCT. AS A STANDALONE SOLUTION. AND YEAH, SO THAT’S DEFINITELY INTERESTING. WE’RE LOOKING AT CERTIFICATES. SO WE LAUNCH A CERTIFICATE TOGETHER WITH CAMBRIDGE ENGLISH. THAT’S I THINK VERY, VERY INTERESTING. AND THAT — I THINK THAT HAS A VERY INTERESTING PERSPECTIVE AS WELL. >>LET’S LOOK AHEAD EVEN A LITTLE BIT MORE. WHEN I TOLD SOME OF MY COLLEAGUES I WAS GOING TO TALK TO YOU, THEIR ANSWER WAS, WHY EVEN STILL LEARN A LANGUAGE IF I HAVE A BUILT-IN TRANSLATOR IN MY EAR IN A FEW YEARS? WHAT’S YOUR TAKE ON THAT? JULIE? YOU WERE SIGHING THERE.>>BECAUSE IT CAN — HAVING REALTIME TRANSLATION IN YOUR EAR, ON YOUR PHONE, IS AWESOME. IT’S A GREAT TOOL. BUT IT’S NOT TRULY A COMMUNICATION. THE RICHNESS OF COMMUNICATION THAT YOU CAN ACHIEVE WHILE PAUSING TO LISTEN TO A TRANSLATION AND THEN HAVING THE SAME GOING BACK AND FORTH AND NOT HAVING THE NUANCE. YOU CAN’T WHISPER SWEET NOTHINGS IN SOMEONE’S EAR THAT WAY. IT’S NOT THE RIGHT KIND OF CONNECTION. SO IT’S FANTASTIC FOR SMALL — IT’S AN ASSIST. IT’S GREAT, BUT IT DOESN’T REPLACE BEING ABLE TO DO THIS AT A CONFERENCE.>>JUST HAVING RETURNED FROM CHINA, I HAVE BEEN IN MEETINGS WHERE THERE WAS A HUMAN TRANSLATOR. AND IT WILL TAKE TIME UNTIL MACHINES ARE THAT GOOD. SO SHE WAS REALLY GOOD AT HER JOB. DID I LIKE IT? DID I LIKE THE SITUATION? NOT AT ALL. I WAS SO HAPPY THAT THE PEOPLE I TALKED TO HAD AT LEAST SOME ENGLISH TO BRIDGE THAT. AND I THINK IF WE LOOK AT WHAT LANGUAGE DOES, ONLY A SMALL FRACTION IS CONVEYING INFORMATION. MOST OF IT IS RATHER ON THE SOCIAL AND OTHER ASPECTS. SO IT’S NOT REALLY ABOUT HAVING IT TRANSLATED, IT’S ABOUT SPEAKING TO EACH OTHER. THAT IS WHAT WE WANT TO DO. THE MORE WE HAVE TO DO WITH PEOPLE OF OTHER MOTHER TONGUES, THE MORE WE WANT TO SPEAK THEIR LANGUAGE. >>WHAT ABOUT THAT OTHER PART? YOU MENTIONED THERE’S THE LEARNING OF THE LANGUAGE, BUT THERE’S A WHOLE CULTURAL SIDE OF IT AS WELL THAT YOU JUST HE WANTED AT. IS THAT SOMETHING YOU FOCUS ON AT ALL? OR YOU WANT TO?>>YES, YES. WE DO. SO IF YOU LOOK AT OUR COURSES, THEY ALWAYS TRANSPORT A LOT OF THE CULTURAL THAT’S MIXED IN WITH THE LANGUAGE. SO YOU WOULD LEARN AROUND — A LOT ABOUT HOW THE CULTURE WORKS AND WHAT’S SELF EXPLANATORY IN A COUNTRY AND WHATNOT, WHICH BY THE WAY IS MY DEFINITION OF CULTURE. SO THAT’S KEY. ALSO, IF YOU LEARN ANOTHER LANGUAGE, YOU JUST OPEN UP A NEW WORLD. YOU START TO THINK DIFFERENTLY. AND UNDERSTAND NEW THINGS. YOU OF ALL PEOPLE, OF COURSE, KNOW THAT. SO I THINK YOU SPEAK AT LEAST THREE, FOUR LANGUAGES, RIGHT, FLUENTLY?>>MOST DAYS, YEAH.>>SO THAT IS SOMETHING THAT MAKES YOUR HORIZON A LOT BROADER. >>ABSOLUTELY. NOW JULIE, YOU CAME IN TWO YEARS AGO, YEAR AND A HALF AGO?>>YEP. >>YOU CAME FROM “BUSINESS INSIDER.”>>I DID. >>I’M NOT HOLDING THAT AGAINST YOU, IT’S FINE. WHY DID YOU EVEN GO TO BABBLE?>>WELL, IT WAS — I WAS EMPLOYEE NUMBER FIVE AT “BUSINESS INSIDER.” IT WAS AN AMAZING RIDE. BUT AFTER THE SALE, I KNEW IT WAS TIME FOR ME TO MOVE ON. I KNEW I DIDN’T WANT TO COMPETE WITH “BUSINESS INSIDER,” WHICH HAS GROWN FROM JUST BUSINESS TO A MAINSTREAM CONSUMER PUBLICATION. IT WAS JUST TIME TO DO SOMETHING NEW. AND I WAS — I ACTUALLY KNEW BABBLE. SOMEONE HAD GIVEN TO IT MY DAUGHTER AS A GIFT. I THOUGHT IT WAS A GREAT PRODUCT. AND THEN WHEN I MET THE COMPANY I THOUGHT, THIS IS JUST AN INCREDIBLE GROUP OF PEOPLE. AND IT’S A HIDDEN GEM IN THE U.S. NO ONE’S HEARD OF IT. I COULD DO SOMETHING HERE. THIS THING HAS REAL POTENTIAL. SO I JUST FELT REALLY KIND OF LUCKY IN TERMS OF THE TIMING. ALSO I WANTED TO DO SOMETHING BACK IN THE STARTUP WORLD, ENTREPRENEURIAL, AND WHILE THE PARENT COMPANY IS NOW HUNDREDS OF PEOPLE, WE WERE A DOZEN PEOPLE IN NEW YORK. AND I JUST FELT IT WAS RAW POTENTIAL. AND I WAS RIGHT.>>NICE. AND HAVE YOU BEEN USING IT TO LEARN SOME GERMAN SO YOU CAN TALK TO THESE GUYS? [ SPEAKING GERMAN ]>>IT’S BEEN WORKING OUT? [ SPEAKING GERMAN ]>>VERY GOOD. NEXT TIME WE’LL DO THIS WHOLE SESSION IN GERMAN. WE’LL TEST HOW WELL — WE’LL HAVE ONE PERSON LEARN ON DUO LINGO, ONE PERSON LEARN ON BABBLE, SEE WHO DOES BETTER AT THE END. ALL RIGHT, THANK YOU VERY MUCH. >>THANK YOU. >>THANK YOU.>>THANK YOU, THANK YOU. HELLO, ADORING FANS. I’M GETTING TWEETS THAT ARE LIKE, FUNNY AND STUFF. YOU GUYS ARE COMPLETELY DEAD OUT THERE. I’LL JUST HAVE TO TAKE TWITTER’S WORD FOR IT, WHICH IS DANGEROUS, TRUST ME. OKAY. SO I MADE A MISTAKE. ACTUALLY, I DIDN’T. I’M GOING TO BLAME IT ENTIRELY ON RICHARD SMITH. HE TOLD ME THE FINTECH Q&A WAS 11:30, AND IT IS NOT, IT IS 11:15. SO THERE’S THE CORRECTION RIGHT THERE. AND WITH THAT WE’RE GOING TO GET INTO OUR NEXT PANEL. I’M SURE YOU’RAL FAMILIAR WITH INSTAGRAM. OUR NEXT GUEST NEEDS NO INTRODUCTION. PLEASE WELCOME TO THE STAGE ROBBY STEIN AND YOUR MODERATOR JOSH CONSTEIN.>>OKAY. SO ROBBY, YOU WENT FROM BEING MARISA MAYER’S FIRST BIG ACQUISITION AT YAHOO! WITH YOUR LAST COMPANY, STAMPED, TO RUNNING PRODUCT FOR INSTAGRAM, ONE OF THE MOST POPULAR PRODUCTS IN THE WORLD. HOW DID YOU PULL THAT OFF? AND WHY ARE YOU SO GOOD AT THIS PRODUCT THING?>>WELL, HONESTLY, AFTER THE ACQUISITION OF STAMPED, I WAS LOOKING AT NEW THINGS TO GO DO. ONE OF THE THINGS I GOT IN TOUCH WITH — ONE OF THE THINGS I LEARNED WAS INSTAGRAM WAS HIRING AND LOOKING FOR SOMEONE TO WORK ON SOME NEW PRODUCTS. I ENDED UP MEETING THE TEAM. ABSOLUTELY FELL IN LOVE WITH THE PEOPLE THAT I MET. JUST DECIDED, THIS IS SOMETHING I’M GOING TO TAKE A SHOT AT. I WAS LIVING IN NEW YORK AT THE TIME, MOVED WITH MY WIFE TO THE BAY AREA, AND WE GOT STARTED WORKING ON NEW CONSUMER PRODUCTS FOR INSTAGRAM. OVER THE LAST 2 1/2 YEARS, IT’S BEEN A WILD RUN. WE LAUNCHED STORIES, WE’VE REDONE DIRECT, WE LAUNCHED LIVE, WE MADE BIG CHANGES TO FEED. REALLY NOW I’VE CREATED ALMOST A NEW INSTAGRAM, WHICH HAS BEEN REALLY EXCITING TO BE A PART OF.>>SO WHAT IS YOUR SUPERHERO ORIGIN STORY? WHAT MADE YOU CARE ABOUT DESIGNING PRODUCTS FOR PEOPLE, IN SOCIAL IN THE FIRST PLACE?>>GOOD QUESTION. I THINK THERE’S A COUPLE ASPECTS TO THIS. ONE IS I’VE ALWAYS BEEN KIND OF FAR FROM MY FAMILY. I’VE DONE LONG DISTANCE RELATIONSHIPS FOR A WHILE. MY NOW WIFE, WE DID LONG DISTANCE FOR FIVE YEARS ACROSS COUNTRY. I LIVE IN THE BAY AREA, MY FAMILY’S IN D.C. I’VE ALWAYS CARED ABOUT BRINGING PEOPLE CLOSER TOGETHER AND HOW TECHNOLOGY CAN MAKE THAT MUCH EASIER FOR PEOPLE. THE OTHER ELEMENT, CARING A LOT ABOUT PRODUCT AND DESIGN. ACTUALLY GROWING UP, MY GRANDFATHER WAS A PUBLISHER OF A GRAPHIC DESIGN MAGAZINE CALLED “PRINT.” I’VE ALWAYS CARED ABOUT DESIGN, THINKING THROUGH HOW PRODUCTS GET MADE. BRINGING EXAMPLE THOSE TWO THINGS TOGETHER PROBABLY LED ME TO PRODUCT. >>THERE’S BEEN A LOT OF CHANGES AT INSTAGRAM NATELY. KEVIN AND MIKE, THE COFOUNDERS, THEY LEFT AND THEY SAID THERE’S ALWAYS REASONS WHEN YOU LEAVE. WHAT DO YOU THINK THOSE REASONS WERE?>>KEVIN AND MIKE ARE AMAZING PEOPLE. AMAZING PRODUCT THINKERS, AMAZING LEADERS. THEY WERE AT INSTAGRAM FOR OVER SIX YEARS. THAT’S A PRETTY AMAZING RUN. I THINK IT’S PRETTY HARD TO THINK OF ANOTHER FOUNDING TEAM THAT’S BEEN AT A COMPANY THAT’S BEEN AN ACQUIRED COMPANY FOR THAT LONG. SO I THINK FOR THEM THEY’RE ENTREPRENEURS, EXCITED TO DO NEW THINGS. I THINK THEY SAID IT BEST IN THEIR ANNOUNCEMENT. I’M EXCITED TO SEE WHAT THEY DO.>>BUT THEY DID SAY THERE WAS STUFF INTERNALLY GOING ON. AND ESPECIALLY WITH THE — YOU KNOW, OUR SOURCES SAID THAT THERE WAS TENSION WITH FACEBOOK. YOU KNOW, WHAT DO YOU THINK THAT WAS ABOUT?>>YOU KNOW, I CAN’T KIND OF SPECULATE WHAT’S GOING ON EXACTLY IN THEIR MINDS. BUT I KNOW THAT AS ENTREPRENEURS, WHEN YOU WORK ON SOMETHING FOR A REALLY LONG TIME AND YOU CARE VERY DEEPLY ABOUT IT, IT’S JUST TIME TO GO DO NEW THINGS AT SOME POINT. I THINK THEY GOT TO THAT POINT. >>WHAT WAS THE ATMOSPHERE LIKE INSIDE OF INSTAGRAM AFTER THAT? HOW’S MORALE?>>IT’S ALWAYS TOUGH WHEN FOUNDERS MOVE ON TO NEW THINGS. WE LOVE THEM AND I LOVE WORKING WITH BOTH OF THEM. I THINK WHAT IT DID IS REALLY MOTIVATED US TO REALLY THINK MORE AROUND INSTITUTIONALIZING THEIR IDEALS AND CULTURE THEY BROUGHT TO THE COMPANY. BECAUSE REALLY THEY’RE TWO PEOPLE THAT I THINK DID AN AMAZING JOB CURATING HOW INSTAGRAM BUILT PRODUCT FOR SO LONG. AND NOW IT’S INCUMBENT ON US TO BRING THAT TO SO WE HAVE DONE A LOT OF WORK RECENTLY TO REALLY WRITE DOWN OUR VALUES MUCH MORE — MUCH MORE STRICTLY. IT’S BEEN REALLY IMPORTANT FOR US TO DO. SO NOW EVERY PERSON AT THE COMPANY, WHETHER, YOU KNOW, THEY WERE IN A ROOM WITH MIKE OR KEVIN OR NOT, THEY CAN GO THROUGH THE SAME PROCESS THAT THEY WOULD PUT WORK PRODUCT TEAMS THROUGH.>>THERE HAS BEEN THIS PHILOSOPHY AT FACEBOOK, AND THEY CHANGED IT TO STABLE INFRA. THAT’S FACEBOOK. THAT WASN’T INSTAGRAM AND KEVIN ACTIVATED THIS FIRE WALL BETWEEN THE COMPANIES. NOW WE’RE SEEING MORE FACEBOOK NOTIFICATIONS AND MORE WAYS TO SHARE FROM INSTAGRAM TO FACEBOOK, AND CONTACT SHARING WITH BONFIRE AND MESSENGER. DO YOU FEEL LIKE YOU GUYS, FACEBOOK AND INSTAGRAM ARE COMING CLOSER TOGETHER?>>WHAT’S INTERESTING IS FACEBOOK HAS A DISTINCT SET OF VALUES. INSTAGRAM HAS PEOPLE FIRST, SOLVING PROBLEMS FOR PEOPLE AND MAKING SURE THE USERS ARE NORTH STAR FOR ALL THE DECISIONS WE MAKE, SIMPLICITY, GOING TOING ON THE MOST IMPORTANT PROBLEMS SO YOU HAVE A PRODUCT THAT MAKES SENSE, AND IT’S CRAFT AND CARE. YOU CAN SWEAT THE DETAILS AND YOU CARE ABOUT WHAT YOU’RE BUILDING AND TAKE PRIDE IN IT, AND I THINK THERE IS A DISTINCT KIND OF INSTAGRAM PRODUCT CULTURE THAT WE’RE MAINTAINING, BUT WE SHARE A LOT OF INFRASTRUCTURE AND THAT’S A GOOD THING TOO. WITHOUT FACEBOOK WE WOULDN’T HAVE BEEN ABLE TO LAUNCH LIVE AS QUICKLY AS THEY HAVE, OR ACHIEVE A LOT OF THE THINGS WE HAVE DONE. THERE IS GOOD THINGS WITH BEING APART OF FACEBOOK. I WILL SAY THAT INSTAGRAM IS A LOT MORE SIMPLE THAN FACEBOOK, THE WALL AND SEE WHAT STICKS.NS- A LOT OF TIMES THAT SENDS THESE FLOPPING. WHY IS IT WITH INSTAGRAM YOU HAVE A MUCH HIGHER HIT RATE WITH THE SUCCESS OF YOUR PRODUCT LAUNCHES?>>IT’S A VERY SPECIFIC WAY OF BUILDING. IT STARTS WITH THE USER. WE GO VERY DEEP WITH UNDERSTANDING USER CONCERNS, PROBLEMS AND WHAT’S PREVENTING THEM FROM USING OUR PRODUCTS IN THE WAYS WE HOPE THEY DO. INSTAGRAM’S MISSION IS TO BRING YOU CLOSER TO THE PEOPLE THAT YOU LOVE AND THE THINGS THAT YOU LOVE, AND THERE IS VERY CLEAR WAYS THAT IT’S HARDER FOR THAT TO HAPPEN AND SO WE TRY TO UNDERSTAND THOSE DEEPLY. THE SECOND THING WE DO IS WE RIGOROUSLY AND ANALYTICALLY LOOK AT THE MAIN BARRIERS AND TRY TO PRIORITIZE THEM. THERE ARE ONE OR TWO THINGS THAT REALLY DRIVES WHETHER OR NOT THE PRODUCT WILL WORK OR NOT AND WE HAVE TO ISOLATE THOSE. THE THIRD IS DESIGN. IT’S NATURAL TO USE, AND IT REUSES THE PATTERNS YOU’RE ALREADY USED TO. WE’RE NOT TEACHING YOU NEW THINGS, AND WE DRAW FROM THINGS IN THE REAL WORLD AND WE IMPLEMENT IT. COMBINING THOSE THINGS TOGETHER HAS ALLOWED US TO BRING PRODUCTS AND WE HAVE BEEN VERY FORTUNATE IN THE LAST COUPLE OF YEARS WITH THINGS THAT PEOPLE HAVE LOVED TO USE.>>CERTAINLY SOMETIMES YOU GUYS HAVE TAKEN A PRODUCT AND TURNED IT INTO SOMETHING MUCH MORE POPULAR THAN THE ORIGINAL VERSION. HOW DO YOU CONTRAST THAT WITH FACEBOOK STRATEGY? THEY LOOK DEEPLY AT ANALYTICS AND YOU HAVE THIS MUCH HIGHER SUCCESS RATE. WHAT IS DIFFERENT ABOUT YOUR STRATEGY COMPARED TO THEIRS?>>INSTAGRAM’S WAY OF BUILDING IS TO BE — SPEND MUCH MORE OF THINK MUCH, MUCH MORE ABOUT THE WHY AND AROUND HOW WE WANT IT TO FIT INTO THE INSTAGRAM SYSTEM. THAT’S THE BIGGEST THING FROM INSTAGRAM AND PEOPLE ARE SURPRISED TO HEAR IT WITH THINGS WE HAVE BUILT THAT WE SPENT MONTHS, MONTHS, MONTHS, LITERALLY JUST THINKING ABOUT THE PRODUCT AND THINKING ABOUT DIFFERENT VERSIONS OF IT, THROWING THINGS AWAY AND NOT LAUNCHING AND WHEN YOU LAUNCH, YOU LEARN A LOT AND YOU HAVE TO QUICKLY SEE WHAT’S WORKING AND WHAT’S NOT TO TROUBLESHOOT IT. THE TIME WE SPENT PRE-LAUNCH, THAT MAKES THE INSTAGRAM CULTURE DISTINCTIVE.>>ONE THING THAT DIDN’T QUITE FEEL LIKE THAT THOUGH, THAT DIDN’T FEEL AS LOVED WAS INSTAGRAM TV. WHY?>>IT WAS A LOVED PRODUCT FROM THE PROCESS THAT I SAW. I DON’T KNOW WHAT DROVE YOU TO THINK THAT MAYBE IT HAD LESS. THAT WAS SOMETHING KEVIN WAS DEEPLY INVOLVED IN.>>I KNOW YOU PUT CARE INTO IT, BUT WHY HAVEN’T USERS RESPONDED THE SAME WAY?>>I THINK IT’S AN EARLY PRODUCT. IT’S A BIG, NEW PRODUCT CATEGORY FOR US, TO GET YOU CLOSER TO CREATORS AND IT FITS IN THE SYSTEM AND MAKING SURE THAT PEOPLE ARE LIKING AND ENJOYING IT. IT’S JUST SOMETHING THAT TAKES TIME. IT’S BEING USED BY SO MANY PEOPLE. WHENEVER YOU’RE ADDING SOMETHING FUNDAMENTALLY NEW, IT TAKES TIME FOR IT TO EVOLVE.>>OKAY. SO MARK ZUCKERBERG HAS RECENTLY SAID THAT HE VIEWS SOCIAL NETWORK’S ROLE KIND OF LIKE A GOVERNMENT WHERE, YOU KNOW, THE GOVERNMENT IS EXPECTED TO KEEP CRIME IN CHECK, NOT NECESSARILY ELIMINATE CRIME 100%. THAT SEEMS KIND OF INFEASIBLE. HOW DO YOU THINK ABOUT THAT WHEN YOU ARE DEALING WITH OPIOID DEALERS, BULLYING, MISINFORMATION, ELECTION INTERFERENCE — HOW DO YOU FIND THE TOLERANCE OF WHAT YOU WILL ALLOW AND WHAT YOU KEEP HUNTING FOR?>>YEAH. THERE ARE TWO THINGS WE LOOK AT HERE BECAUSE ULTIMATELY THE GOAL OF ALL WE’RE TRYING TO DO HERE IS CREATE A COMMUNITY THAT’S SAFE BECAUSE OUR MISSION IS TO CONNECT WITH PEOPLE AND THAT’S HARD TO DO IF THERE IS STUFF THAT’S GETTING IN THE WAY. IT IS REALLY MISSION CRITICAL FOR US, AND WE HAVE REALLY TAKEN AN APPROACH TO SOLVING THIS, I THINK THOSE TWO ELEMENTS. ONE IS BEING MUCH MORE PRO-ACTIVE THAN IN THE PAST. THERE ARE CERTAIN THINGS WE KNOW THAT ARE HARMFUL FOR YOU, AND MORE THAN WE CAN IDENTIFY, THINGS LIKE HARASSMENT OR BULLYING AND PULL IT OFF BEFORE OTHER PEOPLE EVEN SEE IT, WHICH WE BUILT CLASSIFIERS TO GO DO NOW. THAT’S GREAT, AND WE SHOULD BE MUCH MORE PROACTIVE IN PROTECTING AND SAFEGUARDING THE COMMUNITY IN THAT WAY. HOWEVER, WE CAN’T FIND EVERYTHING, AND IF YOU WERE TO FIND SOMETHING WITH EVEN THE REMOTE KIND OF FEELING THIS COULD BE BAD, LET’S JUST PULL IT DOWN, YOU MAY ACTUALLY GO TOO FAR BECAUSE YOU’RE PROTECTING PEOPLE’S RIGHTS TO SHARE AND CONNECTING WITH PEOPLE. WE’RE NOT GOING TO GET EVERYTHING PERFECT AND WE HAVEN’T. HOW DO YOU MAKE SURE THERE IS TRANSPARENCY AND CONTROL SO IF YOU SEE SOMETHING YOU CAN REPORT IT. WE HAVE PEOPLE LOOKING AND THERE ARE THINGS ON THE PLATFORM THAT MAY NOT BE ABLE TO BE THERE, AND MAKE SURE USERS ULTIMATELY HAVE THE CONTROL OVER WHO CAN CONTACT THEM OR WHAT CONTENT THEY SEE AND HAVE SOMETHING THEY DO ABOUT IT. >>IS THERE EVER A POINT WHERE YOU’RE, LIKE, WE HAVE DONE ENOUGH ON THIS, AND IT’S NOT ECONOMICALLY FEASIBLE TO KEEP POURING MORE INVESTMENT INTO TRYING TO GET TO 99.9%, 99.99%. HOW DO YOU KNOW WHEN TO STOP?>>WHEN WE HEAR, THIS IS A BAD EXPERIENCE I HAD ON INSTAGRAM AND IT PREVENTED ME FROM HAVING THE POSITIVE EXPERIENCE THAT WE ARE TRYING TO FOSTER AS A TEAM, OUR JOB IS NOT DONE, AND WHEN YOU HAVE A COMMUNITY OF A BILLION PEOPLE, IT’S PROBABLY NEVER DONE. I DO THINK WE HAVE A LONG WAY TO GO STILL, AND AS LONG AS WE KEEP HEARING THAT FROM PEOPLE, FROM ANYONE, WE’RE GOING TO KEEP WORKING ON IT. >>I FEEL LIKE A LOT OF THOSE PROBLEMS HAVE GOTTEN BETTER SOLUTIONS OVER THE LAST YEAR. A.I. FOR DETECTING BULLYING IN PHOTOS, DOING THESE SWEEPS OF FAKE ACCOUNTS. YOU HAVE ALSO DONE THINGS TO GET RID OF BULLYING AND OPIOID DEALERS. YOU REALLY CUT DOWN ON PEOPLE TRYING TO SHARE THEIR CONTACT INFORMATION IN THAT WAY, BUT A YEAR AGO, IT DIDN’T QUITE FEEL LIKE THAT. WHY WAS THAT?>>I MEAN, I THINK EVERY ASPECT OF A NEW PRODUCT CREATES A NEW SET OF CHALLENGES, AND I THINK IT’S HARD TO PREDICT WHAT THOSE CHALLENGES ARE, WITH THEY ARE A PRIORITY. YOU WANT TO NETWORK AND YOU WANT PEOPLE TO CONNECT AND YOU’RE SAYING, IT’S HARD TO FIND MY FRIENDS ON INSTAGRAM AND I’M TRYING TO SHARE MY LIFE WITH THEM, BUT MY SISTER WHO IS IN HIGH SCHOOL ISN’T ON THE PRODUCT. YOU GET THOSE RIGHT IN CRACKING THEM AND YOU REALIZE THE THING THAT WILL DEFINE US NEXT YEAR IS DIFFERENT THAN WHAT GIDEFINED U THE YEAR BEFORE, AND THAT CREATES NEW THINGS WE HAVE TO GO FIX. IT’S HARD TO KNOW LONG-TERM EXACTLY WHAT YOU ARE GOING TO HAVE TO GO DO, AND THE PROCESS WE HAVE TO FOLLOW IS LISTEN TO THESE PROBLEMS AND BE GOOD LISTENERS IN THE WORLD AND HAVE A GREAT, STRUCTURED PROCESS AND ACTUALLY MAKING A CHANGE TO THE SYSTEM WHEN WE SEE IT AND IT’S NEEDED.>>SO INSTAGRAM HAS KIND OF BECOME THIS LIFEBOAT FOR FACEBOOK’S BRAND. IT’S KIND OF WILD THAT 57% OF AMERICANS DON’T ACTUALLY EVEN KNOW THAT INSTAGRAM IS OWNED BY FACEBOOK. DOES THAT PLAY TO YOUR ADVANTAGE?>>I DON’T KNOW IF IT PLAYS TO AN ADVANTAGE, BUT I KNOW THAT INSTAGRAM IS A DISTINCT PRODUCT TO PEOPLE, AND I THINK ONE THING WE TRY TO FOCUS ON IS WHY DO PEOPLE LOVE INSTAGRAM? CAN WE SOLVE THE PROBLEMS THAT ARE INSTAGRAM-FOCUSED? THAT’S WHERE WE SPEND OUR TIME.>>DOES IT EVER FEEL LIKE YOU ARE SORT OF WINNING BECAUSE THESE ARE USERS SHIFTING AWAY FROM FACEBOOK?>>I THINK THAT WHAT HAS BEEN THE ROOT OF INSTAGRAM’S SUCCESS IS JUST BEING FOCUSED ON A SPECIFIC PROBLEM THAT A LOT OF PEOPLE WILL CARE ABOUT. WE WANT TO HELP YOU FEEL CLOSE TO PEOPLE THAT YOU CAN’T BE WITH EVERY DAY, THROUGH FOCUS AND THE VISUAL MEDIUM WHICH HELPS YOU SEE THAT SENSE OF CLOSENESS, IS WHY WE HAVE BEEN SUCCESSFUL IN MY OPINION MORE THAN ANYTHING.>>SO YOU MUST SEE THESE SCANDALS THAT HAPPEN AT FACEBOOK AND YOU SAY, MAN, THAT’S NOT US. THAT’S THEM. THAT’S THEIR PROBLEM SOMETIMES, BUT WITH THINGS LIKE HIRING OPPOSITION RESEARCH FIRM, THE DEFINERS, HOW DID YOU PERSONALLY FEEL ABOUT THAT?>>FACEBOOK HAS BEEN IN THE NEWS A TON AND IT’S TOUGH TO READ STORIES WHERE YOU ARE, LIKE, WOW. OKAY. THAT’S INTERESTING, BUT AT THE END OF THE DAY, WE KNOW INTERNALLY PEOPLE ARE OPERATING WITH THE BEST INTENT POSSIBLE AND INSTAGRAM’S SIDE, WE FOCUS ON WHAT WE CAN DO TO ILL PROVE THINGS. LIKE, WHEN I READ THE NEWS AND I’M, LIKE, OH, WHOA. THERE ARE, LIKE, SOME REAL PROBLEMS IN THE WORLD, IT MOTIVATES ME TO WANT TO FIX THEM WITH AUTHENTICITY, LIKE TAKING DOWN INAUTHENTIC CONTENT WITH API TO PROBLEM SOLVE AND FIX. THAT’S BEEN MY REACTION.>>YOU SAID THAT YOU READ THAT NEWS AND SOMETIMES YOU THINK IT’S INTERESTING. WHAT DO YOU MEAN BY THAT?>>WHEN YOU READ ABOUT YOUR OWN COMPANY IN THE NEWS SO FREQUENTLY, I DON’T THINK A LOT OF PEOPLE HAVE THAT EXPERIENCE. IT’S A VERY, LIKE, SURREAL PROCESS TO HAVE YOUR COMPANY BE NARRATED EXTERNALLY.>>DO YOU GUYS EVER THINK ABOUT HOW YOU’RE HIRING ALONG THESE LINES? THINKING MAYBE WE SHOULD BE HIRING MORE SKEPTICS. IS THAT SOMETHING YOU’RE TRYING TO DO? IT’S HARD TO PREDICT THE PRODUCTS AND HOW PEOPLE WILL USE THEM.>>IT’S TOUGH TO UNDERSTAND WHAT PEOPLE WILL DO WITH THE PRODUCTS SOMETIMES. ARE YOU GUYS PURPOSEFULLY LOOKING FOR THE IDEALISM?>>I THINK HIRING THAT TYPE OF PERSON AND IT’S MORE ABOUT THE CULTURE ENTIRELY WHERE EVERYBODY IS THINKING ABOUT THE SET OF PROBLEMS. UNDERSTANDING WE HAVE A NEW SET OF PROBLEMS THAT MAY NOT BE AS BIG YEARS AGO WHEN WE WERE REALLY SMALL AND NOW THEY’RE ABSOLUTELY ESSENTIAL TO GET RIGHT. FOR PRODUCT THAT IS WE BUILT AND SOME OF THE NEW ONES THAT WE’RE ACTUALLY TALKING ABOUT, WE HAVE IN THE ROOM, HAD DISCUSSIONS AROUND, HEY. HOW COULD THIS BE USED TO, LIKE, HURT PEOPLE? OR HOW COULD A BULLY POTENTIALLY USE THIS? AND WE’RE ACTUALLY PUSHING OURSELVES WAY HARDER BECAUSE WE KNOW NOW WE’RE SO BIG, THIS IS MUCH, MUCH MORE OF AN ISSUE AND IT’S OUR JOB TO PROTECT OUR COMMUNITY AND ANTICIPATE THOSE NEEDS.>>SO ALONG THOSE LINES, YOU GUYS HAVE BEEN BUILDING NEW PRODUCTS TO TRY TO FOCUS ON THIS CONCEPT OF AUTHENTICITY. KIDS ARE GROWING UP THESE DAYS QUANTIFYING THEIR SELF-WORTH THROUGH LIKES AND I THINK INSTAGRAM MIGHT EMBLEMIZE THAT MORE THAN ANY PRODUCT. WITH THAT HEART, AND IT GIVES YOU THAT DOPAMINE HIT, THAT FEEDBACK, BUT WHY QUANTIFY LIKES IN THE FIRST PLACE PUBLICLY? I UNDERSTAND WHY YOU SHOW THEM TO ME, BUT WHY EVERYBODY ELSE?>>WHAT’S IMPORTANT TO KNOW IS INSTAGRAM IN THE LAST TWO YEARS HAS FUNDAMENTALLY EVOLVED AND I THINK THE FEED WAS THE ONLY PRODUCT WHEN I STARTED THE COMPANY WAS BEING USED AT SCALE, AND I THINK OUR JOB HAS BEEN TO CREATE NEW, DIFFERENT WAYS THAT YOU CAN SHARE THAT ALLOW FOR THE TYPE OF EXPRESSION AND SHARING OF ALL OF YOUR MOMENTS THAT YOU CAN PUBLISH AND NOT HAVE TO BE CONCERNED ABOUT SOMETHING LIKE THE LIKE COULD NT. FOR ME, LAUNCHING STORIES, RELAUNCHING DIRECT, WHICH IS A PRIVATE MESSENGER, THEY CREATE DIFFERENT WAYS YOU CAN SHARE BASED ON WHAT YOUR NEEDS ARE. FOR FEED, IT’S A BENEFIT THAT EVERYONE SEES CERTAIN TYPES OF THINGS, LIKE WHEN THERE IS A SPECIAL MOMENT FOR YOU, YOU WANT PEOPLE TO SEE THEM AND BE ABLE TO COMMENT AND LIKE THEM, AND IT MAKES THEM FEEL GREAT AND CONNECTED TO THOSE PEOPLE. WE’RE FOCUSSED AROUND THOSE TYPES OF MOMENTS WHERE THOSE PARTS OF THE SYSTEM ARE VERY VALUABLE AND THINGS LIKE STORIES FOR DISCUSSION, AND YOU’RE, LIKE, THIS IS A THING I’M DOING, THINKING, OR FEELING AND GENERATE DISCUSSION AND IT’S ABOUT CONNECTING WITH PEOPLE.>>DO YOU EVER THINK OF NOT SHOWING HOW MANY LIKES MY PHOTO HAS TO OTHER PEOPLE?>>IT’S SOMETHING WE HAVE THOUGHT THROUGH, AND SOMETHING WE NEED TO CONTINUE TO THINK THROUGH. HAVING DIFFERENT WAYS TO SHARE YOUR LIFE IS THE SOLUTION, BECAUSE USUALLY THE THINGS THAT HAVE TAKEN OFF AND BEEN SUCCESSFUL HAVE BEEN SUCCESSFUL FOR A REASON. THEY ARE ADDING PEOPLE TO SOME WAY, BUT FOR US, THE BALANCE OF FEED PLUS STORIES PLUS DIRECT AND LIVE GETS THE STORY TO GO AWAY, GIVES YOU THE FULL INSTAGRAM EXPERIENCE.>>YOU HAVE BUILT SOMETHING COOL TO FOCUS ON THIS, AND GIVE NEW WAYS TO SHARE OUTSIDE OF THAT LIFE-DRIVEN ECOSYSTEM. DO YOU WANT TO SHARE WHAT YOU HAVE GOT?>>ABSOLUTELY. TODAY I’M VERY, VERY EXCITED AND PROUD TO ANNOUNCE A NEW FEATURE WE HAVE BEEN WORKING ON FOR QUITE AWHILE IN TESTING AND IT’S BEEN BUILT OFF OF STORIES WHICH HAS GROWN IN THE LAST COUPLE OF YEARS TO BE A PRODUCT THAT MOST INSTAGRAM USERS USE EVERY DAY NOW, 400 MILLION PER DAY HAVE ACCESS TO.>>CAN WE GET THAT PRESENTATION UP ON THE SCREEN?>>WE’LL SHOW YOU A QUICK PRESENTATION THAT TALKS ABOUT A PRODUCT CALLED CLOSE FRIENDS WHICH HELPS YOU SHARE WITH AN INNER CIRCLE IN YOUR STORIES.>>HERE WE GO. ♪ ♪>>COOL. SO IT’S A WAY THAT YOU CAN ADD PEOPLE TO A SMALL LIST OF FRIENDS AND JUST SHARE YOUR STORY WITH JUST THEM.>>YES.>>SO TELL ME ABOUT THE IDEA OF HOW THIS OFFSETS THIS KIND OF SOCIAL PRESSURE WE HAVE OVER TIME TO JUST ADD ANYONE WHO SENDS US A FRIEND REQUEST.>>SO ULTIMATELY BECAUSE STORIES GREW TO BE QUITE LARGE, IT’S GREAT THAT NOW YOU CAN SHARE WITH LOT OF PEOPLE AND KEEP IN TOUCH WITH THEM, BUT ALSO MEANS IT’S HARD TORE ER TO GO DEEPER SHARE THE PERSONAL MOMENTS WITH YOUR FRIENDS. IT ALLOWS YOU TO CREATE A LIST OF PEOPLE, ONE SIMPLE LIST AND ADD AS MANY PEOPLE AS YOU WOULD LIKE, AND IT’S USUALLY PEOPLE THAT THEY WOULD KIND OF DESCRIBE THEM AS THESE ARE MY REAL FRIENDS AND PEOPLE I SEE AND TALK TO REGULARLY. IF YOU ADD THEN OR REMOVE THEM WE DON’T NOTIFY THEM. IT’S A PRIVATE LIST TO THE CREATOR AND WHAT HAPPENS IS WHEN YOU SHARE YOUR CLOSE FRIENDS STORY, PEOPLE SEE A LITTLE BIT MORE FROM YOU, AND IT ALLOWS YOU TO SHARE MORE DEEPLY WITH A SET OF PEOPLE THAT YOU ARE CLOSER TO ON INSTAGRAM. IT WILL HELP YOU BALANCE THE THINGS THAT ARE MAYBE FOR EVERYONE, WITH THE THINGS THAT ARE MAYBE FOR A SMALL INNER CIRCLE. >>THERE IS ONE CONCERN WITH THINGS I HAVE LIKE THIS, WHICH IS THAT YOU COULD CREATE THIS LITTLE SORT OF SAFE HAVEN ECHO CHAMBER WHERE PEOPLE COULD SHARE OFFENSIVE CONTENT THAT THEY WOULDN’T SHARE PUBLICLY BECAUSE THEY WOULD GET IN TROUBLE. HOW DO YOU BUILD TO PREVENT THAT?>>WHAT’S IMPORTANT IS IT’S CONNECTED CONTENT. IT’S PEOPLE YOU ARE FRIENDS WITH AND THEY ARE SAYING, THIS IS SOMEONE THAT’S A CLOSE FRIEND OF MINE. THE OTHER PIECE OF IT IS THAT IT’S JUST SHARED TO, LET’S SAY, A COUPLE DOZEN PEOPLE YOU MIGHT WANT TO ADD TO, AND IT’S ADDED TO YOUR STORY. IT’S NOT GOING TO GENERATE GROUP DISCUSSION. YOU’RE JUST SHARING MORE OF YOUR LIFE AND PEOPLE MAY REPLY TO YOU DIRECT. IN USAGE AND TESTING WE HAVEN’T SEEN THAT USE CASE AS USED, BUT IT’S DEFINITE HE WE WANT TO LOOK OUT FOR AND BE CAREFUL OF AND MAKE SURE PEOPLE ARE BEING CAREFUL WITH THE PROCESS.>>IS THIS A NAIL IN SNAPCHAT’S COFFIN?>>THIS IS HOW YOU GO DEEPER WITH THE PEOPLE YOU CARE ABOUT, AND THAT’S WHY WE BUILT THIS. IF YOU LOOK AT THE ARC OF WHAT WE HAVE TRIED TO DO, THE FIRST YEAR WAS HELPING ROUND OUT THINGS LIKE FEEDS, STORIES, A NEW DIRECT AROUND VISUALS, LIVE, MAKING A PLACE YOU CAN POST MULTIPLE POSTS TO LIVE FOR YOUR HIGHLIGHTS. THE LAST YEAR HAS BEEN MUCH MORE ABOUT DEEPENING YOUR RELATIONSHIPS WITH FRIENDS, AND SO IF YOU LOOK AT THINGS WE HAVE BUILT STORIES AROUND INTERACTIVE, CREATIVE TOOLS LIKE QUESTIONS, OR POLLS WHICH TYPICALLY REPLIES FROM DIRECT THREADS, ALL THE WAY TO LIVE HANGOUTS AND DIRECT, I THINK THIS IS AN EXTENSION OF THAT, SO YOU CAN HAVE THIS DEEPER CONNECTION TO THE PEOPLE THAT YOU CARE MOST ABOUT.>>I MEAN, FROM FACEBOOK FRIEND LISTS TO SNAPCHAT GROUPS TO GOOGLE PLUS CIRCLES IF YOU GUYS REMEMBER THOSE, THIS IS PRETTY MUCH A CEMETERY OF FEATURE, BUT I THINK YOU GUYS HAVE ACTUALLY REALLY FINALLY BUILT THIS RIGHT AND SO IT’S INCREDIBLE TO SEE ANCESTORS WHO PRINT MAGAZINES ABOUT GRAPHICS WHO WANT TO BUILD THINGS FOR OTHER PEOPLE, AND THEN TO YAHOO, AND EVEN THOUGH YOUR FOUNDERS HAVE LEFT, YOU’RE CARRYING ON THE VALUES OF CRAFT AND SIMPLICITY AND PUTTING PEOPLE FIRST AND YOU’RE DOING THE DEEP RESEARCH BEFORE YOU LAUNCH SO YOU DON’T HAVE TO WORRY ABOUT THESE FLOPS THAT SOME OTHER COMPANIES END UP DOING WHEN THEY TRY TO PUSH NEW PRODUCTS AND I HAVE SEEN YOU GUYS BECOME MORE PROACTIVE ABOUT FIGHTING PROBLEMS AND THERE IS ALWAYS MORE WORK TO DO, AND I HOPE YOU GUYS KEEP UP ON IT AND SAY THE SOCIETAL IMPACT IS MORE IMPORTANT THAN THE PROFIT, BUT, YOU KNOW, THERE REALLY SEEMS — THE SCANDALS ARE MOTIVATING YOU GUYS TO WORK HARDER ON THESE THINGS AND I HOPE YOU REALLY DO DEVELOP THIS CULTURE OF F FORESIGHT, WHICH INSTAGRAM CAN DO WHAT IT WAS MEANT TO DO, WHICH GIVE US A WINDOW INTO THE LIVES OF THE PEOPLE THEY LOVE MOST. THANK YOU FOR TALKING AND THANK YOU FOR WATCHING.>>THANK YOU.>>THANK YOU, AVI AND JOSH. QUICK REMINDER THERE WILL BE FOOD TRUCKS AT LUNCH AND YOU CAN TAKE ADVANTAGE OF THAT RIGHT NOW DURING A BREAK. WE HAVE GOT LOTS MORE IN STORE INCLUDING THREADS, EXCEL AND THE BATTLEFIELD FINAL. WE WILL SEE YOU SHORTLY AFTER THE BREAK. THANK YOU. BYE-BYE.>>HOW DID YOU LAND ON THIS IDEA?>>SO THIS IS A PORTABLE SENSOR THAT DETECTS PEANUT IN YOUR FOOD AND IT’S REALLY ACCESSIBLE. STARTED OFF WITH GLUTEN. I HAVE A LOT OF FOOD SENS SENSIT SENSITIVITIES, ALLERGIES AND FOUND IT WAS HARD TO EAT OUTSIDE OF HOME. GLUTEN HAS BEEN ON THE MARKET FOR ABOUT A YEAR AND NOW WE HAVE PEANUT. >>WHAT WAS THE SCIENCE BEHIND IT? HOW DOES IT DETECT IF THERE IS A PEANUT IN THE FOOD?>>IT’S A CHEMISTRY-BASED TEST AND YOU HAVE A ONE-TIME USE CAPSULE AND YOU PUT A SAMPLE OF FOOD IN THE CAPSULE AND THE CAPSULE IN THE SENSOR AND IT WILL TELL YOU IF THAT FOOD CONTAINS A TRACE AMOUNT OF PEANUT. >>HOW ACCURATE IS THIS?>>THE ACCURACY, WE HAVE DONE A LOT OF INTERNAL AND THIRD PARTY LAB TESTING WHICH WILL BE AVAILABLE WHEN WE LAUNCH. WE HAVE FOUND THAT IF THERE IS A TRACE AMOUNT, TEN PARTS PER MILLION OF PEANUT IN THAT SAMPLE, WE HAVE A 98.8% CHANCE OF PICKING IT UP WITH THE DEVICE.>>I’M DEFINITELY ALLERGIC TO NUTS AND OFTENTIMES I’LL READ LABELS, YOU KNOW, ON THE BACK OF LABELS SAY MAY CONTAIN TRACES OF PEANUTS.>>RIGHT.>>DO YOU THINK THAT WOULD BE ABLE TO PICK UP THOSE TRACES IN THERE?>>IN THE BETA TESTING, WE FOUND A LOT OF PEOPLE WERE TESTING THOSE FOODS WITH THE UNCLEAR LABELING AND THEY WERE ABLE TO PICK IT UP. IT DEPENDS ON THE SAMPLE YOU’RE PUTTING IN. IT WILL NOT OBVIOUSLY GUARANTEE THAT EVERYTHING YOU’RE ABOUT TO EAT IS GOING TO BE PEANUT-FREE, BUT IT GIVES YOU THAT ONE ADDITIONAL DATAPOINT. IFTHERE ARE TEN PARTS PER MILLION, IT WILL PICK IT UP. IT’S A CONNECTED DEVICE AND IT’S BLUETOOTH CONNECTED ON YOUR PHONE AND YOU CAN RECORD WHAT YOU TESTED WHERE YOU TESTED, WHETHER IT’S A PACKAGE FOOD OR WHATEVER, SO YOU CAN HAVE ACCESS TO THE USERS TESTING ALL THE TIME. >>SO IF I’M AT A RESTAURANT, I MIGHT — THERE IS AN APP AND I MIGHT OPEN THE APP AND SEE, OH, SOMEONE TESTED THIS DISH.>>EXACTLY.>>LAST WEEK OR SOMETHING?>>YES. SOMEONE TESTED THIS DISH AND IT SEEMED OKAY AND WE FIND PEOPLE WANT TO TEST THEMSELVES ANYWAY.>>THE CONDITIONS COULD HAVE CHANGED IN THE KITCHEN. >>WE SEE A LOT OF PEOPLE USING IT FOR PACKAGED FOODS LIKE AT TRADER JOE’S AND THEY USE THAT TO MAKE A BETTER PURCHASING DECISION. >>NICE. THIS IS AWESOME. CAN WE GET A DEMO?>>DEFINITELY. YEAH. YOU GET THIS SAMPLE OF FOOD. YOU TAKE A LITTLE, YOU KNOW, PEA-SIZED AMOUNT HERE.>>YEAH.>>REALLY, REALLY SMALL AMOUNT.>>OKAY.>>PUT IT IN HERE, THIS IS THE CAPSULE AND THE ACTION OF CLOSING THE CAPSULE GRINDS THE FOOD.>>OH.>>AND THEN YOU CLOSE IT ALL THE WAY AND YOU HEAR THAT POP. THAT INITIATES THE CHEMISTRY? THERE. THE CODE IS TESTED WITH THE ANTIBODIES. THERE IS A LITTLE LAB IN HERE. POP THAT RIGHT IN HERE, YOU TURN IT ON AND I’M GOING TO JUST TURN IT ON THERE, AND THEN YOU SHOULD START TO HEAR IT PROCESSING. IT SHOULD SAY TESTING FOR PEANUT, AND THEN IT’S GOING TO START PROCESSING AND MAKE A LITTLE BIT OF A NOISE. THAT NOISE IS BOYC BASICALLY MI AND THEN IT WILL RELEASE THE SAMPLE TO THE TEST STRIP AND WE’LL SEE WHETHER OR NOT THAT SAMPLE CONTAINS PEANUT. IT TAKES LESS THAN FIVE MINUTES, BUT THERE IS NO PEANUT, IT WILL TAKE LONGER. IF THERE IS PEANUT, IT WILL DETECT IT FASTER.>>OH.>>WE DID SAY THERE IS PROBABLY A MILLION NUTS IN HERE. >>I SHOULD MENTION — >>I DID SAY.>>AND I ALSO HAD SOME, YOU KNOW, IT’S SUPER SENSITIVE.>>HOW MUCH DOES THIS COST?>>SO THE SENSOR ITSELF IS $2.29, AND THE CAPSULES IF YOU SUB SUBSCRIBE, IT’S ABOUT $5 PER CAPSULE. >>WHEN CAN I GET THIS?>>THIS YEAR. IT’S COMING OUT SOON.>>COOL. I’M LOOKING FORWARD TO IT. IT’S GOING TO BE REALLY AWESOME TO USE. THANKS FOR COMING IN.>>THANK YOU.>>OH MY GOD. LOOK AT THAT. SO GOOD. BEEF, CHEESE AND A PUCICKLE ON TOP. BY GUESS WHAT? THESE DOGS ARE 100% VEGAN.>>VEGAN? ALL RIGHT.>>THERE ARE 7.3 BILLION PEOPLE IN THIS WORLD AND THAT NUMBER IS PROJECTED TO JUMP TO 9.7 BILLION BY 2050. HO DO WE FEED THESE PEOPLE? IT’S A QUESTION A LOT OF SMART FOLKS ARE STARTING TO ASK. ♪ YOU GOOD? ALL RIGHT. DON’T BE NERVOUS.>>JUST KIDDING. SO TELL ME WHAT IS THE PROBLEM THAT BEYOND MEAT IS TRYING TO SOLVE?>>HUMAN HEALTH, CANCER, CLIMATE CHANGE, THINGS LIKE HOW MUCH WATER WE USE AND ANIMAL WELFARE. ALL FOUR OF THOSE THINGS CONVERGE AROUND THE PROTEIN CHOICES ON THE PLATE. IF YOU MA ♪>>LADIES AND GENTLEMEN, PLEASE WELCOME BACK TO THE STAGE EDITOR JORDAN CROOK.>>WHAT’S UP, SQUAD? ALL RIGHT, WE’RE GOING TO KEEP THINGS MOVING AND WE’RE GOING TO DIVE INTO THE WONDERFUL WORLD OF FASHION. SO WITH THAT, PLEASE WELCOME TO THE STAGE, SOPHIE HILL FROM THREADS AND YOUR MODERATOR, INGRID LONDON. THEY’RE WILD FOR YOU GUYS RIGHT NOW.>>HI, EVERYBODY.>>HELLO.>>HEY. HI, EVERYONE. THANK YOU FOR COMING BACK FROM THE BREAK. WE HAVE GOT AN AMAZING GUEST HERE. I’M A BIG FAN. SOPHIE.>>HI. >>HI. THANKS FOR COMING. OKAY. SO YOU GUYS ARE DOING SOMETHING THAT’S ACTUALLY QUITE COMMON IN SOME MARKETS. FOR EXAMPLE, IN ASIA, BUT IT’S KIND OF, LIKE, A NOVEL APPROACH FOR HERE, SO WHAT WE SAW WAS IT WOULD BE A GOOD WAY OF INTRODUCING US TO GIVE US A ONE TO TWO-MINUTE RUN THROUGH OF HOW THREADS WORKS AND THEN WE’LL GO INTO MY PROBING QUESTIONS. >>YEAH.>>SO WE’RE GOING TO RUN A VIDEO I THINK.>>YES.>>SOPHIE’S GOING TO NARRATE IT.>>OKAY. SO THIS IS WORKING YOU THROUGH OUR CUSTOMER JOURNEY, SO OUR MISSION AT THREADS IS INSPIRE, ACQUIRE, DELIVER. SO IT’S VERY CONTENT-LED COMMERCE. ♪ SO THIS IS THE INSPIRATION PART. SO OUR TEAM MAKES CONTENT THAT CLIENTS ENGAGE WITH AND CONSUMERS, AND WE HAVE QUITE A BIG TEAM THAT ARE MAKING THIS CONTENT EVERY SINGLE DAY.>>ON MESSAGING APPS.>>YES.>>ONLY MESSAGING APPS.>>YEAH. SO IN CHINA, THAT’S, YOU KNOW, WECHAT, REDBOOK, AND HERE IT’S INSTAGRAM, SNAPCHAT, WHATSAPP, STORIES.>>YOU DON’T HAVE A WEBSITE, RIGHT?>>YEAH. SO WE DON’T HAVE A WEBSITE OR AN APP. WE REALLY BELIEVE ABOUT SPENDING TIME WHERE THE CUSTOMER IS, AND OUR CONSUMERS ARE ACROSS ALL DIRECT MESSAGING AND SOCIAL APPS.>>WHICH SHOULD BE A VERY INTERESTING MESSAGE FOR THE AMAZONS OF THE WORLD. I THINK.>>AND THEN HERE IS WHERE THAT CONTENT LEADS TO, SO IT’S AN EXAMPLE, AND THIS IS ACTUALLY A REAL CONVERSATION WITH A CONSUMER, FOLLOWING A PIECE OF CONTENT THAT WENT LIVE. SO THIS WOULD BE — IT KIND OF SHOWS A COMPLETE JOURNEY OF HOW SOMEBODY WOULD SHARE THE CONTENT WITH THEIR PERSONAL STYLIST AND THEN HOW THAT WOULD ACTUALLY LEAD THE A TRANSACTION. I THINK THIS CONVERSATION WAS ABOUT A 33,000-POUND TRANSACTION.>>HOW LONG IS THE WHOLE TURNAROUND TIME FROM THE MOMENT THAT YOU GUYS START THE CONVERSATION AND THEY ACTUALLY BUY THE THING?>>I THINK THIS EXAMPLE IS A MATTER OF HOURS.>>HOURS.>>YEAH.>>IS THAT AVERAGE OR DOES IT GO SOMETIMES OVER A WEEK OR, LIKE — >>NO. I WOULD SAY RELATIVELY WITHIN ONE OR TWO DAYS, BUT WE HAVE HAD CONVERSATIONS THAT WERE AS SHORT AS FIVE MINUTES.>>RIGHT.>>I THINK THIS PARTICULAR ONE WAS ACTUALLY VERY SHORT. I THINK IT WAS DEFINITELY UNDER TWO HOURS, BUT IT WAS OBVIOUSLY QUITE A LARGE PURCHASE. SO — >>YEAH. WE’LL GET TO THE SIZE, BUT DO YOU EVER CUT PEOPLE OFF? LIKE, I THINK YOU’RE DOING TOO MANY, AND WE HAVE TO CUT YOU OFF, LIKE A BARTENDER. IT CAN PROBABLY BE QUITE AD ADDI ADDICTIVE.>>WE ARE A LUXURY RETAILER AND I THINK IT’S REALLY IMPORTANT THAT CUSTOMERS HAVE EITHER ITEMS THEY NEED OR ITEMS THEY LOVE.>>YEAH.>>SO WE VERY MUCH MAKE SURE THAT OUR TEAM ARE GIVING THE CUSTOMERS WHAT THEY ABSOLUTELY LOVE. SO IF WE THOUGHT THAT IT WASN’T RIGHT FOR THEM, WE WOULD DEFINITELY RECOMMEND SOMETHING ELSE. >>OKAY. OKAY. KEEP GOING.>>AND THEN THIS IS JUST A VIDEO OF, YOU KNOW, OUR CUSTOMERS AND ALSO OUR COMMUNITY. THIS IS THE KIND OF FEEDBACK AND WE HAVE THEM MAKING VIDEOS OF OPENING THEIR PARCELS.>>DO THEY DO THAT A LOT?>>YEAH.>>OR DO YOU ASK THEM TO AND YOU’RE, LIKE, HEY, UNBOX IN FRONT OF US. WE WANT TO POST IT ON SOCIAL MEDIA.>>WE HAVE QUITE A BIG COMMUNITY, AND SO A LOT OF PEOPLE WILL DO IT WITHOUT ANY PROMPTING. >>RIGHT.>>WE ALSO LOOK AFTER A LOT OF INFLUENCERS AS WELL, AND, YOU KNOW, THEY WILL ABSOLUTELY START MAKING VIDEOS OF THIS, BUT I THINK OUR CUSTOMERS NATURALLY DO IT, AND THEY ARE CONSTANTLY SHARING FEEDBACK EVERY DAY. >>COOL. WONDERFUL. THANK YOU SO MUCH. I THINK THAT’S THE END OF OUR LITTLE WALKTHROUGH. AWESOME. OKAY. SO YOU GUYS ARE A VERY INTERESTING COMPANY BECAUSE AT YOUR CORE, YOU’RE DOING SOMETHING QUITE TRADITIONAL WHICH IS THAT YOU ARE SELLING. YOU HAVE GOT A SALESPERSON CONNECTING WITH A BUYER, A CONSUMER. >>YEP.>>A SHOPPER, AND OFFERING THEM THINGS AND SELLING IT, BUT YOU CALL YOURSELF — YOU ARE A TECH STARTUP. YOU RAISED $20 MILLION.>>YEP.>>IN AUGUST. CONGRATULATIONS. AND YOU’RE GOING TO BE USING THAT MONEY TO INVEST IN THE BUSINESS. TELL ME WHAT YOU ARE DOING THAT’S TECH IN THE THREADS ECOSYSTEM.>>I THINK THE WHOLE BUSINESS HAS REALLY BEEN BUILT ON TECHNOLOGY. SO YES WE ARE A RETAILER IN A TRADITIONAL SENSE THAT WE SELL LUXURY GOODS TO CONSUMERS, BUT I THINK WHAT WE ARE AS A BUSINESS HAS BEEN VERY MUCH ASKING THE CON CONSUMERS HOW THEY WANT TO SHOP AND HOW THEY HAVE TOLD US THEY WANT TO SHOP IS VERY MUCH THROUGH MESSAGING. SO WHETHER THAT’S, YOU KNOW, ALL DIRECT MESSAGING PLATFORMS AND SOCIAL MEDIA. SO FOR US, WE WERE LEVERAGING ALL OF THE TECHNOLOGY OUT THERE, TO DIRECTLY TALK TO THE CONSUMERS AND THE ENVIRONMENTS THAT THEY CHOSE. THE BUSINESS WAS BUILT ON TECHNOLOGY, AND THE NEXT STEPS ARE, YOU KNOW, IT’S HOW DO WE BUILD MORE TECHNOLOGY TO INCREASINGLY MAKE IT A PERSONALIZED EXPERIENCE? SO DATA IS VERY IMPORTANT. I THINK THERE IS SO MUCH CHOICE FOR CONSUMERS. I THINK TECHNOLOGY IS GOING TO PLAY A REALLY KEY ROLE IN HOW DO WE PERSONALIZE THIS. HOW DO WE MAKE SURE WE’RE ONLY SHOWING OUR CUSTOMERS THINGS THAT ARE RELEVANT TO THEM, THAT ARE EXCITING TO THEM.>>YEAH.>>THAT WE THINK THEY WOULD LOVE, AND ULTIMATELY, THAT JUST ENHANCES THE EXPERIENCE.>>DO YOU THINK THAT IT WILL BE SOMETHING WHEN YOU BUILD FOR EXAMPLE, AN A.I. TO HELP SOURCE AND TAILOR PERSONALIZED A SET OF HANDBAGS FOR ME, FOR EXAMPLE, DO YOU THINK THAT WILL BE MORE FOR YOUR ASSISTANCE TO THEN PRESENT TO THEM, OR DO YOU THINK YOU MAY PUSH THE HUMAN OUT OF THE, YOU KNOW, PULL BACK THE HUMAN OUT OF THE EQUATION AND JUST OFFER IT AS AN AUTOMATIC CHOICE BEFORE A HUMAN GETS INVOLVED?>>I THINK WITH TECHNOLOGY, YOU HAVE ALWAYS GOT TO START FROM THE CONSUMER’S PERSPECTIVE. SO EVERYTHING WE DO, YOU KNOW, WE THINK, WOULD THAT BE RIGHT FOR THE CUSTOMER, AND I THINK IF WE’RE REALLY ABLE TO PINPOINT WHAT THE CUSTOMER WANTS AND REALLY FEEL THAT IT’S VERY RELEVANT, I THINK THAT COULD BE DEFINITELY A BLEND OF FULL ULTIMATUM, BUT IT COULD BE A BLEND BECAUSE I THINK IT STARTS ON A 400,000-POUND PIECE OF JEWELRY, WHICH IS COMPLEX AND THEY WANT TO MAKE SURE THEY’RE SPEAKING TO SOMEBODY.>>THE HIGHER END IT IS, THE LESS YOU WANT TO PUT A CHATBOT IN CONNECTION WITH IT. >>AS TECHNOLOGY EVOLVES, IT’S HOW MUCH THAT LANGUAGE WILL BE ABLE TO BE PART OF THE CONVERSATION. THE CONVERSATION ITSELF IS KEY TO THE EXPERIENCE. SO I THINK WE WILL ROLL THINGS OUT AS AND WHEN WE FEEL IT’S APPROPRIATE, AND I THINK WELL INVOLVE OUR CUSTOMERS. I MEAN, ULTIMATELY CONVENIENCE IS IMPORTANT, AND IF THEY JUST WANT THE PRICE OF AN ITEM AND HOW FAST IT WILL GET TO THEM — >>RIGHT.>>YOU WANT TO ULTIMATE THAT AS FAST AS POSSIBLE. IF THEY WANT TO HAVE A LONG CONVERSATION ABOUT THIS OR THAT, TECHNOLOGY WOULD HAVE TO BE READY.>>I WANT TO SWITCH THE OTHER SIDE OF THE TECH. YOU ARE ON MESSAGING PLATFORMS NOW, A WIDE VARIETY OF THEM.>>YEAH.>>SOMETIMES KIND OF TAILORED TO THE REGION YOU’RE SELLING INTO. HAVE YOU — WHAT IS THAT — HOW DOES THAT PLAY OUT FOR YOU GUYS AS A BUSINESS? DO YOU THINK THAT YOU MIGHT AT ONE POINT, TRY TO BUILD YOUR OWN STAND ALONE MESSAGING PLATFORM, BECAUSE DO YOU WORRY ABOUT BEING DEPENDENT ON THIRD PARTIES AS YOUR CHANNEL?>>I MEAN, I THINK FOR US WE SAY WE’RE CHANNEL AGNOSTIC AND THE BUSINESS HAS BEEN BUILT ON ASKING THE CONSUMERS HOW THEY WANT TO SHOP AND WHERE THEY WANT TO SHOP, AND I THINK THAT EACH SOCIAL CHANNEL OR MESSAGING CHANNEL IS A CUSTOMER PREFERENCE. SO FOR ME, I FEEL IT’S SLIGHTLY MORE DANGEROUS CREATING, YOU KNOW, A SILO ECOSYSTEM THAT’S HOURS WHICH ULTIMATELY MEANS THEY HAVE TO COME TO US.>>YEAH. MUCH HARDER TO BE DISCOVERED.>>RIGHT. I BELIEVE IT’S OUR JOB — >>YOU DON’T THINK THAT WOULD HAPPEN EVEN AS YOU GOT BIGGER? YOU’RE ONLY GOING TO GROW IN IMPORTANCE.>>I MEAN, OUR AMBITIONS ARE VERY BIG, AND I STILL DON’T FEEL THAT IT’S NECESSARILY THE RIGHT MOVE FOR US TO BE DOING THIS. I THINK THE TECHNOLOGY WE’RE BUILDING IS VERY IMPORTANT THAT IT JUST ALLOWS THAT COMMUNICATION TO BE ANYWHERE THE CUSTOMER IS, AND THE TECHNOLOGY THAT WE’RE BUILDING BEHIND HAS TO FACILITATE THAT, AND THAT’S NOT STRAIGHT FORWARD, BUT IT MEANS THAT THE CUSTOMER UL ULTIMATELY GETS TO MOVE. SO, YOU KNOW, ONE WEEK IT’S SNAPCHAT. THE NEXT WEEK IT’S INSTAGRAM, AND THEN IT MIGHT BE, YOU KNOW, WHATSAPP TODAY OR iMESSENGER AS MORE PIECES ROLL OUT HERE IN EUROPE AND THE U.S. WE HAVE TO BE AGILE TO BE ABLE TO MOVE.>>YEAH. IT’S QUITE INTERESTING BECAUSE I DO FEEL LIKE IT’S A PRETTY FICKLE WORLD, THE MENTIONING WO — MESSAGING WORLD. YOU HAVE TO LOOK AT SNAPCHAT TO SEE THE RUG PULLED OUT FROM UNDER THEM, AND YOU NEVER KNOW WHAT’S THE NEXT BIG THING.>>SOME CUSTOMERS ARE LOYAL TO SNAPCHAT.>>I MEANT, LIKE — >>ABSOLUTELY. WE DID SEE, LIKE, PEOPLE MOVE TOWARDS INSTAGRAM.>>YEAH.>>BUT THERE IS A SMALL GROUP OF CUSTOMERS THAT ARE SO LOYAL, AND AGAIN, IT’S HAVING TO BE ON EACH PLATFORM IN DIFFERENT VOLUMES AS WELL.>>EXACTLY. OKAY. NOW YOU GUYS NOW ARE — YOU STARTED OUT TARGETING AS YOU WOULD EXPECT FROM A CONCIERGE SERVICE, PRETTY HIGH END BUYER. THE WOMAN, USUALLY A YOUNGER WOMAN WHO IS ALREADY SHOPPING FOR LUXURY GOODS AND THAT SORT OF THING, RIGHT?>>YES.>>AVERAGE BASKET SIZE — >>ABOUT $3,000.>>SO SLIGHTLY OUT OF THE PRICE RANGE OF A JOURNALIST, BUT $3,000 WHICH IS IMPRESSIVE, BUT INEVITABLY, YOU MUST BE LOOKING — DO YOU THINK YOU’RE GOING TO STAY HIGH END? I KNOW I HAVE ASKED YOU THIS BEFORE, BUT I THINK IT’S ALWAYS IMPORTANT TO REVISIT THESE QUESTIONS BECAUSE I THINK PEOPLE CHANGE THEIR MIND. DO YOU THINK AS YOU GUYS GROW — YOU HAVE GOT $20 MILLION IN FUNDING NOW, AND YOU WANT TO GET BIGGER. DO YOU THINK YOU WILL STAY AT THE HIGH END OR DO YOU THINK THAT WILL MEAN TRICKLING DOWN? LOOK AT FARFETCHED. THEY HAVEN’T CHANGED FROM BEING HIGH END. THEY GOT VERY BIG BY STAYING LUXURY.>>YOU CAN GET VERY BIG STAYING IN LUXURY. I THINK WHAT’S REALLY IMPORTANT TO THREADS IS THAT WE’RE EXPERTS AND WE ARE EXPERTS IN LUXURY AND WE UNDERSTAND HOW TO CURATE AND TALK TO CONSUMERS AND WE ACTUALLY SAY MILLENNIAL MINDSET MILLENNIALS, BUT IT’S PEOPLE THAT WANT TO SHOP OR INTERACT WITH US THIS WAY FOR RETAIL, BUT I THINK FOR US, IT’S — WE WOULD POTENTIALLY GO INTO OTHER VERTICALS. WE’RE ALREADY STARTING TO LOOK AFTER A LOT OF MAN, YOU KNOW, I DO SEE — >>ARE YOU GOING TO BUY THREADS? I CAN’T BELIEVE THERE ARE TWO THREADS.>>THEY ARE FOCUSED ON HIGH STREET.>>RIGHT.>>SO I THINK FOR STAYING IN LUXURY, GOING INTO NEW VERTICALS, YOU KNOW, WE ONLY LAUNCHED FINE JEWELRY ABOUT 18 MONTHS TO TWO YEARS AGO, AND THAT’S HUGE, AND IT’S REALLY EXCITING. SO DEFINITELY NEW CATEGORIES VERSUS LOWERING IT.>>THERE IS MUCH MORE TO TACKLE IN LUXURY BEFORE YOU START CONSIDERING, HOW DO YOU TAKE ON MY FORMER EMPLOYER? WHICH IS ARCADIA.>>OUR EXPEER RTISE IS IN LUXUR AND WHEN WE ROLL OUT A NEW VERTICAL, WE WANT TO BE THE BEST AT IT. THE WAY OUR RETAIL IS SET UP, IT MIGHT FEEL SLIGHTLY LESS CONVENTIONAL IN EUROPE OR THE U.S., BUT OUR STANDARDS OF RETAIL ARE VERY MUCH LUXURY.>>OKAY. NOW YOU GUYS IN THE FACT THAT YOU ARE TARGETING THE LUXURY MARKET, AS ANYBODY WHO IS WORKING ANY COMMERCE OR FASHION PROBABLY KNOWS, ASIA IS VERY BIG. THE CHINESE MARKET IS VERY LARGE FOR YOU, RIGHT?>>YES.>>I DON’T KNOW IF YOU HAVE BEEN FOLLOWING WHAT’S BEEN GOING ON WITH DOLL CHI AND GA BAA IN A –>>I WAS IN SHANGHAI.>>WHAT’S GOING ON, IS — DO YOU WANT TO SAY IT?>>NO. YOU SAY IT.>>SHORT VERSION. SOCIAL MEDIA CAMPAIGN MASSIVELY BACKFIRED, SUPER OFFENSIVE. PEOPLE ARE BOYCOTTING THE LABEL OR TRYING TO GET OTHER PEOPLE TO BOYCOTT IT. DO YOU WORK WITH THEM?>>SO YES WE DID HAVE A WITH THEM.>>DID? NO MORE?>>I THINK — WHAT WE’RE DOING NOW IS TALKING TO OUR CONSUMERS. I THINK THAT INCIDENT IN ITSELF SHOWS HOW POWERFUL SOCIAL MEDIA IS, AND YOU NEED TO TALK TO YOUR CONSUMERS AND, YOU KNOW, WE’RE COPS CONSTANTLY HAVING VERY OPEN DIALOGUE. A LOT OF CUSTOMERS GOT IN TOUCH WITH US FROM ALL OVER THEIR WORLD EXPRESSING THEIR POINT OF VIEW ABOUT IT. >>INTERESTING.>>I THINK FOR US IT’S ABOUT JUST, YOU KNOW, I THINK THAT PARTICULAR — ANY PARTICULAR INCIDENT JUST SHOWS THAT ACTUALLY, YOU KNOW, IT’S REALLY IMPORTANT, ANY MARKET THAT YOU WORK IN, THAT YOU REALLY NEED TO UNDERSTAND AND GET TO KNOW THAT MARKET. SO FOR US, YES, WE ARE VERY FOCUSED ON THE ASIAN MARKET, BUT WE HAVE BEEN SPENDING THE LAST TWO YEARS TALKING TO AMBASSADORS, CONSUMERS AT ABSOLUTE LENGTH TO UNDERSTAND.>>ARE YOU PULLING BACK FROM SELLING THEM AT THE MOMENT? IF SOMEONE SAYS, I WANT THIS DRESS I SAW CARRIE MULLIGAN WEARING — >>I THINK RIGHT NOW WE’RE NOT NECESSARILY CREATING EDITORIAL CON CONTENT.>>RIGHT.>>BUT EQUALLY WE HAVE TO LOOK AT CONSUMERS ALL AROUND THE WORLD AND WE’LL VIEW IT CAUSE B CASE.>>THE THING IS YOU ARE IN A LUXURY POSITION OF — YOU DON’T HAVE A WEBSITE. YOU DON’T HAVE AN APP. SO YOU’RE SO INDIVIDUALIZED THAT IF A CUSTOMER SAYS, I DON’T WANT D & G, YOU DON’T HAVE TO, AND IF SOMEBODY ELSE DOES, I SUPPOSE, BUT YOU GUYS DON’T TAKE, LIKE, AN ETHICAL STAND ON THAT?>>I THINK WHAT WE DO IS, AGAIN, WE HAD A LOT OF CONVERSATIONS REALLY LISTENING TO CUSTOMERS AT THE TIME OF THAT EVENT AND WE WILL, YOU KNOW, WE OPENLY APPRECIATE HOW EVERYBODY WAS SO UPSET AND EQUALLY, YES, IT WASN’T GREAT. I DON’T THINK IT WAS GREAT FOR THE INDUSTRY. I THINK, AGAIN, YOU SHOULD NOT BE MOVING INTO A MARKET JUST BECAUSE YOU SEE OPPORTUNITY. YOU SHOULD BE MOVING INTO A MARKET, GETTING TO KNOW THAT MARKET.>>YEAH.>>REALLY UNDERSTANDING WHAT’S IMPORTANT TO THEM AND ACTUALLY AS WE — >>MAYBE YOU SHOULD HAVE A TALK WITH DOLCE & GABBANA. THEY MIGHT HAVE FORGOTTEN THIS IMPORTANT LESSON OF MARKETING.>>WE SPENT TIME WITH CHINESE CONSUMERS ASKING THE SAME QUE QUESTION, AND THE ONLY QUESTION WE ASK OUR FUTURE CONSUMERS, HOW DO YOU WANT TO SHOP? WHAT DO YOU WANT FROM US? WHAT TYPE OF CONTENT DO YOU WANT? WHAT DO YOU FIND INSPIRING? WHAT’S THE CHECKOUT PROCESS FOR YOU? WECHAT IS AN INCREDIBLE ECOSYSTEM AND IT’S EASY FOR OUR BUSINESS MODEL TO BE IN ASIA. IT’S REALLY IMPORTANT THEN BECAUSE THAT ECOSYSTEM EXISTS AND IT’S WHAT CONTENT DO THEY WANT THERE US?>>YEAH. >>OUR CUSTOMERS ARE EDITORS IN CHIEF BECAUSE, YOU KNOW, IT’S REALLY IMPORTANT TO US. IT’S NOT ABOUT WHAT OUR BUYERS WANT, AND WE HAVE A STRONG POINT OF VIEW ON STYLING, BUT ACTUALLY WHAT WE’RE STYLING IS VERY MUCH DICTATED BY THEM AS WELL.>>OKAY. I WANT TO ASK YOU ONE OTHER VERY QUICK QUESTION ON THIS GENERAL SUBJECT.>>YEAH.>>AND THEN MOVE ONTO ONE LAST ONE BEFORE WE RUN OUT OF TIME. YOU HAVE GOT, YOU KNOW, IN THE FASHION INDUSTRY, YOU HAVE GOT A TON OF THESE OTHER ISSUES GOING ON, AND ANOTHER ONE THAT I HAVE NOTICED IS, YOU KNOW, JUST THE ETHICS OF CLOTHING AND HOW CLOTHING GETS WASTED AND SO ON. DO YOU GUYS SEE YOURSELVES AS PLAYING A ROLE IN ANY OF THAT? OTHERS HAVE BEEN UNDER ATTACK FOR BASICALLY DESTROYING CLOTHES WHEN THEY DON’T SELL. WHAT IS YOUR VIEW ON THAT, AND HOW DO YOU THINK YOU COULD PLAY A ROLE IN THAT?>>I THINK WE’RE IN LUXURY. SO, YOU KNOW, EVERYTHING WE’RE SELLING IS ULTIMATELY KIND OF USUALLY HAND-CRAFTED OR MADE TO THE HIGHEST QUALITY, AND THE TWO PRINCIPLES OF THREADS ARE CURATION AND CONVENIENCE, AND YOU SAY, DO YOU OVERSELL TO BUY A LOT OF LUXURY GOODS?KE TO- WE SAY, NO. IF SOMETHING IS GOING TO BE ASSOCIATED TO THREADS AND THEIR WAR WARDROBE, IT HAS TO BE BECAUSE THERE WAS A NEED OR THERE WAS AN EVENT. THEY NEEDED SOMETHING OR BECAUSE THEY ABSOLUTELY LOVED IT. SO AGAIN, I THINK BY REALLY FOCUSING ON PEOPLE BUYING LESS, BUT HIGHLY CURATED AND REALLY WANTING TO WEAR AND USE THE THINGS IN THEIR WARDROBE ACTUALLY, YOU KNOW, WE’RE ALL PLAYING A POSITIVE ROLE INTO THAT, AND WE’RE NOT SAYING BE WASTEFUL. WE’RE SAYING REALLY BE SELECTIVE. >>I KNOW WE TALKED ABOUT, CAN YOU GO DOWN MARKET, BUT DO YOU THINK YOU CAN SCALE THAT? DO YOU THINK THAT’S THE SORT OF BUYING TENDENCY THAT MORE PEOPLE COULD SHIFT TO? DO YOU THINK THAT CONSUMERS ON A WIDER SCALE — DO YOU THINK AMAZON MIGHT EVER TRY TO DO SOMETHING LIKE THIS?>>SOMETHING LIKE THREADS?>>YES.>>I MEAN, THEY MAY — >>IT GOES COMPLETELY AGAINST THE ECONOMY OF SCALE.>>I MEAN, WE DON’T BELIEVE IT GOES AGAINST THE ECONOMY OF SCALE BECAUSE ITULTIMATELY, YOU ARE LOOKING AT, LET’S LOOK AT FAR FETCH MATCHES AND THERE IS A HIGH VOLUME OF LUXURY CONSUMERS AND 85% OF THOSE ARE MILLENNIAL AND GEN Z AND IT WILL BE 45% BY 2025. THE VOLUME OF CONSUMERS IS THERE, AND IT’S ABOUT HELPING PEOPLE MAKE GOOD CHOICES.>>DO YOU THINK THAT VOLUME WILL EVER WHOLESALE WHILE WE SHIFT INTO THIS TYPE OF SHOPPING?>>I THINK CURATION AND DIALOGUE ARE REALLY IMPORTANT. FOR RETAILERS TO MEET THE NEEDS OF MILLENNIALS OR GEN Z, THEY HAVE TO PUT THAT BACK INTO THE EXPERIENCE. HOW AND WHAT WE DO, WILL BE SEEN.>>DO YOU WORRY ABOUT — DO THOSE LUXURY STORES, RETAILERS, ARE THOSE YOUR MAIN COMPETITORS DO YOU SAY, OR DO YOU WORRY ABOUT AN AMAZON TAKING A MOVE INTO THE SPACE?>>I THINK — >>WALMART.>>I THINK DEFINITELY, YOU KNOW, YOU HAVE GOT TO BE AWARE OF WHAT’S HAPPENING IN THE RETAIL LANDSCAPE. I THINK YES, PEOPLE COULD MOVE INTO THIS SPACE, BUT I THINK WE WOULD LIKE TO BE THE BEST AT WHAT WE DO, AND SO IT WOULD MAKE US EVEN MORE AMBITIOUS TO MAKE SURE WE ARE ABSOLUTELY NUMBER ONE, AND AGAIN, WE REALLY UNDERSTAND HOW TO, YOU KNOW, WE WORK HARD ON HOW TO CREATE THEM FOR THE NEW CUSTOMERS AND IT WOULD DRIVE US TO CONTINUE TO BE THE BEST. >>OKAY. COOL. THANK YOU. WE ARE OUT OF TIME. THANK YOU SO MUCH. BEST OF LUCK.>>THANK YOU. THANK YOU.>>THANKS, EVERYBODY. [ APPLAUSE ] ♪♪ ♪>>HOW MANY ENTREPRENEURS ARE IN THE ROOM? SERIOUSLY, THAT’S IT? I EXPECTED EVERYONE’S HANDS TO GO UP EXCEPT FOR THESE GUYS AND HIS HAND IS UP ANYWAY. THIS WILL BE INTERESTING TO YOU, AND I’M NOT SURE WE HAVE DONE A PANEL QUITE LIKE THIS WHERE WE BRING THE PARTNERSHIP FROM A FIRM AND HAVE THEM ALL TOGETHER ON ONE STAGE. SO WITH THAT, PLEASE WELCOME FROM ACCEL, YOUR PANEL AS WELL AS YOUR MODERATOR.>>THANK YOU. HI, GOOD MORNING, EVERYONE. WE ARE THRILLED TODAY TO HAVE FOUR INVESTORS FROM ONE OF EUROPE’S MOST POWERFUL VENTURE FIRMS WITH US. IT WAS BACK IN 2001 THAT — EXCUSE ME, THAT ACCEL OPENED ITS LONDON OFFICE TO INVEST IN EUROPEAN STARTUPS AND SUNSINCE THEN, THE TEAM HAS DELIVERED SPOTIFY, AND MANY OTHERS. BECOMING A GO-TO FIRM FOR FOUNDERS IN THE PROCESS. BEFORE WE JUMP INTO THINGS, SOME OF YOU PROBABLY KNOW KNOW. PHILIPPE BOTTERI IS A NATIVE OF FRANCE, AND NEXT TO HIM IS SONALI DE RI YCKER. THEN WE HAVE LUCIANA LIXANDRU, AND THEN HARRY NELIS. I THOUGHT WE WOULD BREAK THIS DOWN.>>THANK YOU.>>YOU HAVE YOUR OFFICE IN L LONDON. THERE IS ANOTHER OFFICE IN INDIA. TO WHAT EXTENT DO YOU WORK TOGETHER AND SHARE INVESTORS? HARRY?>>OUR OBJECTIVE AS ACCEL IS TO INVEST IN THE BEST TECHNOLOGY COMPANIES ON EARTH, AND WE — WE AIM TO DO THAT BY SHARING A GLOBAL RADAR SCREEN OF INTERESTING OPPORTUNITIES WHETHER THEY ARE IN AMERICA, EUROPE OR INDIA. SO THAT’S THE OBJECTIVE. THE WAY WE PRACTICALLY DO IT IS WE — WE USE THINGS CALLED PREPARED MINDS TO FOCUS ON PARTICULAR AREAS THAT WE’RE INTERESTED IN, AND THEN WE ASK INPUT FROM OUR PARTNERS IN PAULO ALTO OR INDIA, AND WE THINK IT’S A WINNING HAND IN THE SECTOR AND WHEN WE HAVE DETERMINED THAT, WE’LL LOOK FOR COMPANIES NO MATTER WHERE THEY ARE LOCATED AND AIM TO WHAT THE BEST WAS. >>YOU START WITH THE FOCUS AND THEN YOU SORT OF GO FROM THERE. CORRECT?>>CORRECT. YES.>>WHAT HAPPENS WHEN THERE IS A COMPANY LIKE SPOTIFY FOR EXAMPLE, THAT’S INTERESTING AND VERY PROMISING. HOW DO YOU SORT OF DECIDE I GUESS, HOW BIG A CHECK YOU WILL WRITE VERSUS ONE OF THE OTHER OFFICES OR IS IT ALL ONE OF A PIECE? SONALI?>>TO THE PREVIOUS QUESTION, I WANTED TO SAY THE FACT THAT WE DECIDED IN 1999 THAT THE WORLD WAS NOT JUST ABOUT SILICON VA VALLEY, AND LOOK AT HOW FAR BERLIN HAS COME, AND THAT WAS OBVIOUS, AND IT WAS THE WORLD’S MOST UNSCALEABLE BUSINESS, AND THE FACT WE’RE HERE 18 YEARS LATER, PLUS INDIA IS THE FACT WE DID IT IN A WAY THAT WAS DIFFERENT BECAUSE WE HAVE OUR LOCAL TEAMS. WE INVEST IN EUROPE, AND I’LL GET TO YOUR ANSWER. THE INDIA TEAM INVESTS IN INDIA, AND THEN WE ALL PULL IN IF WE THINK IT MAKES SENSE. FOR SPOTIFY, WHICH WAS AT THE OUTSET SO WE INVESTED A BIT MORE THAN SEVEN YEARS AGO. QUITE EARLY, AND THE COMPANY HAD A MILLION AND A HALF PAYING USERS JUST TO GIVE YOU A OFSENS OF THE SIZE. HOW DID WE HELP THEM NOT JUST GO GLOBAL, BUT GET TO THE U.S.? WE SHARED THE CAPITAL ALSO WITH OUR U.S. COLLEAGUES BECAUSE WE WERE ON THE BORDER OF FACEBOOK AT THE TIME, THE SPOTIFY/FACEBOOK RELATIONSHIP BECAUSE THAT’S HOW THEY LAUNCHED IN THE U.S. WHICH WAS OF PRIMAL IMPORTANCE. SO IT’S CASE BY CASE, BUT THE WAY WE COVER UP THE WORLD IF THAT’S THE BROADER QUESTION, IS THIS TEAM AND A BROADER TEAM ARE BASED IN LONDON AND IT’S ACROSS EUROPE. THAT’S REALLY ACROSS EUROPE INCLUDING EASTERN EUROPE, THE INDIA TEAM, INVESTS IN INDIA, AND THE U.S. IN U.S. THERE IS A FUNDAMENTAL PIECE ON THAT SIDE AND WE WORK CLOSELY TOGETHER.>>IF I CAN BUILD ON THAT FOR A SECOND, THAT’S AN IMPORTANT POINT WHICH I TAKE PRIDE IN, WHICH IS ACCEL WAS A BELIEVER IN EUROPE WHEN MOST CAPITAL FUNDS WERE STILL JUST LOOKING AT SILICON VALLEY AND NOT GLOBALLY AT A TIME WHEN IT WASN’T OBVIOUS THERE WOULD BE $30 BILLION COMPANIES COMING OUT OF EUROPE. SO I THINK THAT’S ONE THING THAT MAKES ME VERY PROUD AT LEAST ABOUT ACCEL. >>SURE. DO YOU SHARE THE SAME INVESTORS OR THESE DISCREET, SO EVERYBODY UNDERSTANDS.>>A LOT OF OUR INVESTORS ARE INVESTING ACROSS THE ENTIRE CON INNOC — CONTINENT. FOR OUR SENTREPRENEURS, WE ARE ONE PLATFORM AND FOR OUR INVESTORS AS WELL. >>OKAY, GREAT. TELL ME YOU’RE IN LONDON AND WITH THE MAJORITY OF YOUR INVESTMENTS ARE IN LONDON. WHAT PERCENTAGE OF YOUR INVESTMENTS ARE NOT IN THE UK AND MAYBE IN WHAT COUNTRIES SPECIFICALLY ARE YOU INTERESTED IN? HARRY? SORRY.>>YOU CAN ANSWER IT.>>I WAS GOING TO SAY I’M HAPPY TO TAKE THIS QUESTION BECAUSE JUST TO GIVE YOU A ZOOM INTO MY CALENDAR THESE TWO WEEKS, I JUST FLEW FROM NEW YORK YESTERDAY WHERE ONE OF MY COMPANIES, THE COMMERCIAL HEADQUARTERS, I FLEW TO BERLIN AND GOING TO HELSINKI NEXT WEEK AND THEN SAN FRANCISCO FOR ANOTHER BOARD COMPANY FOR HEADQUARTERS THERE. ALL THIS TO SAY THE EUROPEAN MARKET IS ACTUALLY VERY F FRAGMENTED AND WITH THE RISE OF REALLY INTERESTING ENTERPRISE COMPANIES, THE ECOSYSTEM IS BECOMING MORE AND MORE FRAGMENTED RATHER THAN LESS. IF YOU THINK BECAUSE HUMOR OUTCOMES MANY HAD BEEN AROUND THE UK, GERMANY, AND MANY OF THE COMPANIES ARE STARTING IN UNUSUAL LOCATIONS. LIKE AN HOUR OUTSIDE COLON, ROMANIA AND SO FAR AND SO FORTH.>>I WOULD SAY ABOUT 70% OF OUR COMPANIES ARE NOT IN THE UK.>>IS THAT RIGHT?>>YEAH.>>DO THEY NEED TO MOVE THEIR HEADQUARTERS TO THE U.S. AT SOME POINT? I DON’T KNOW IF ENTERPRISE IS SPECIFICALLY SOMETHING THAT — >>I THINK IF ENTERPRISE A LOT OF TIMES IT DOES MAKE SENSE. IT DEPENDS ON THE MODEL, BUT IF IT IS A GLOBAL COMPANY THAT WANTS TO WIN ON A GLOBAL SCALE, IT’S IMPORTANT TO WIN IN THE U.S. A MODEL THAT WE HAVE SEEN WORK WELL IS WHERE THE TECHNOLOGY TEAM STAYS IN EUROPE AND THE CO-FOUNDER/CEO STAYS HERE AND KEEPS BUILDING THE TECHNOLOGY TEAM HERE WHILE WE GO TO MARKET OR AT LEAST THE KEY PART OF GOING TO MARKET IS BUILT IN THE U.S. >>WHY IS THAT?>>ONE THING JUST TO ADD, WHICH IS INTERESTING IS THAT ENTERPRISE SOFTWARE, AND THE COMPANIES HAVE BEEN ME EMERGING FROM EUROPE FOR THE PAST 15 YEARS. THIS COMPANY WILL NEED TO GO TO THE U.S. AND THAT’S WHERE THE U.S. MARKET IS. ONE THING THAT IS INTERESTING THAT WE’RE SEEING IS THE DEPTHS OF PENETRATION OF TECHNOLOGY IN OUR DAILY LIVES. IT REALLY WIDENED THE MARKETS OF WHAT WE’RE SEEING IN EUROPE, AND WE’RE SEEING A NEW BREED OF COMPANIES, SOFTWARE COMPANIES WHICH ARE FOCUSING ON SPECIFIC SEGMENTS LIKE SMALL BUSINESSES WHERE THEY CAN BUILD A VERY BIG BUSINESS JUST STAYING ON A COUPLE OF COUNTRIES OR THREE COUNTRIES IN EUROPE. I MEAN, I’LL MENTION FOR EXAMPLE, A TECHNOLOGY PROVIDER FOR DOCTORS. THEY ARE JUST FRANCE AND GERMANY, BUT THESE MARKETS ARE BIG ENOUGH FOR IT TO BE A VERY LARGE — VERY LARGE BUSINESS. >>RIGHT. ONE COMPANY THAT’S BRANCHED OUT IS UI PATH, WHICH IS ONE OF THE FASTEST GRAND-COMPANIES. YOU GREW UP IN ROMANIA, AND YOU FOUND THAT COMPANY FOR ACCEL. CAN YOU TELL US HOW THAT CAME TOGETHER?>>ABSOLUTELY. SO WE’RE VERY HAPPY TO INVEST EARLY. AT THE TIME, THE COMPANY — MOST OF THE COMPANY’S EMPLOYEES WERE IN ROMANIA AND ACTUALLY SOME IN INDIA. BUT IT DIDN’T REALLY HAVE FEET ON THE GROUND IN THE U.S., BUT WHAT I THOUGHT WAS INTRIGUING WAS BLUE CHIP CUSTOMERS FROM THE U.S. WERE FINDING THEM IN ROMANIA AND BUYING THEIR PRODUCT. SO THERE WAS A FLAG THAT WENT ON THERE. I WAS, LIKE, WOW. THAT’S REALLY INTERESTING AND ON TOP OF THAT, THE ENTREPRENEUR HAS A BIG VISION, AND IT’S IMPORTANT TO NOT GET EXCITED ABOUT INVASION. WE MET HIM FOR THE FIRST TIME A COUPLE OF YEARS AGO, AND THE COMPANY HAS EXPANDED TO 16 GLOBAL OFFICES. COMMERCIAL HEADQUARTERS HAVE MOVED TO NEW YORK. THAT’S WHERE I FLEW BACK FROM YESTERDAY, AND THEY WENT FROM THE SMALLER COMPANY IN THE SPACE TO THE CLEAR LEADER BASED ON, YOU KNOW, FORESTER, ANALYSTS AND CUSTOMERS ALIKE. IT’S BEEN A REALLY SPECIAL JOURNEY. WE’RE THRILLED TO BE PART OF THAT JOURNEY.>>THAT’S FANTASTIC. YOUR POINT ABOUT TRAVELING SO MUCH, HOW DO YOU KEEP FROM SPREADING YOURSELF TOO THIN I GUESS? SONALI?>>WE CHECKED AND INVESTED IN THE LAST COUPLE OF FUNDS IN 20 CITIES AND 15 COUNTRIES. I MEAN JUST FROM THE LONDON OFFICE, AND THAT GIVES YOU A SENSE OF THE SCALE AND THE SCOPE, AND IF ANYTHING, WHAT WE FOUND, YOU KNOW, BACK TO SOME OF THE DISCUSSION WE’RE HAVING IS THERE ISN’T A TON OF SIGNAL. SO WE LOOKED AT THE FACT WE HAVE HAD 50 PLUS ENTREPRENEURS IN THE SAME PERIOD AND THEY WENT TO 44 DIFFERENT SCHOOLS, CAME FROM DIFFERENT UNIVERSITIES. AFTER THAT, THEY WORKED AT DIFFERENT PLACES. THE REALITY IS THE ONLY WAY TO — ESPECIALLY WITH THE FACE AT WHICH DEALS AND VENTURE CAPITALIST MOVING, YOU REALLY NEED TO BE IN MARKET AND HAVE A GLOBAL FILTER. WE BELIEVE STRONGLY IN CONCENTRATING IN LONDON BECAUSE THAT’S HOW WE MAKE GOOD DECISIONS, BUT WE HAVE TO BE IN THE MARKET. SO I THINK THE WAY WE DO IT IS THAT WE’RE VERY THEMATIC. WE THINK HARD AROUND, WHAT IS EUROPE GOOD AT? THERE ARE SECTORS WE HAVE IDENTIFIED AROUND, ENTERPRISE, AND WE GO VERY, VERY DEEP. WE HAVE SEEN A COMPANY THAT LOOKS INTERESTING AND WE ACTUALLY HAVE A BLUEPRINT OF WHAT IS TO FIND AS INTERESTING FOR US AND THERE IS A CLICK AND A MATCH. SO IT’S A BIT OF OUTBOUND, BUT ALSO IT’S A BIT OF DEEP THINKING AROUND HOW THE CATEGORIES ARE EVOLVING AND WHAT WE THINK CONSTITUTES THE WINNING HAND. IF WE DIDN’T HAVE THAT SORT OF DEEP APPROACH, AND OF COURSE,>>THAT’S HOW IT’S A VERY FRAGMENTED MARKET.>>I WONDER HOW UNIFORM STARTUP CULTURE IS. YOU SEE HOW FOUNDERS ACT DIFFERENTLY IN DIFFERENT REGIONS. YOU MENTIONED SOMETHING YOU SAW HAPPENING IN THE NORDICS.>>YES. I HAVE TO WATCH THE TIME. LOOK, I THINK THERE ARE GREAT BUSINESSES EVERYWHERE. NOT ALL GREAT BUSINESSES HAVE GREAT CULTURES. WE FOUND SOMETHING SPECIAL IN THE NORDICS BECAUSE TRULY THESE WERE GREAT PLACES TO WORK AT. LOW TURN. WE THOUGHT, LET’S DIG DEEPER. THE REALITY IS HOW STARTUP CULTURE EVOLVES HAS TO DO WITH HOW CULTURE EVOLVES. WE SAT DOWN WITH NORDIC CELL, CLICK TECH TO NAME SOME EXAMPLES. WE SAT DOWN WITH FOUNDERS AND ASKED WHY IS THIS THE CASE? IN THE NORDICS, IN THE SOCIALIST SOCIETY, PEOPLE ARE TRULY EQUAL. THE FOUNDER, THE CEO, THEY DON’T WORK FOR THE CEO. THE CEO WORKS FOR THE EMPLOYEES. THERE IS THIS CULTURE WHERE PEOPLE ARE REALLY EMPOWERED. IF YOU GO TO THE KITCHEN, SPRAY PAINTED EVERYWHERE IS THEIR MOTTO, WHICH IS DON’T F IT UP. IT IS YOUR RESPONSIBILITY. DON’T TRY TO DO SOMETHING MORE POLITICALLY CORRECT AND IT FELL APART. SUPER CELL, THE REASON THAT WORD WAS CHOSEN. THE REGION IS ALL AROUND CELLS. THE CELLS MAKE THE DECISION. ILKA CALLS HIMSELF THE LEAST POWERFUL CEO. TALKS ABOUT THE STORY OF THE GAME DEVELOPERS IN THE CELLS HAD TO MAKE DECISIONS OF WHETHER THEY KILL OR MAKE GAMES. THEY HAD A RULE THAT IT HAD TO REACH A SET OF METRICS. THIS GAME EVERYONE BELIEVED IN WAS REALLY THERE, THEY CAME BACK FROM A BUSINESS TRIP AND THAT WAS CANCELED. HE WASN’T EVEN NOTIFIED. THERE IS SUCH EMPOWERMENT. YOU REALLY GIVE IT UP AT A GRANULE LEVEL.>>SO SUPER CELL NEVER CHANGED ITS HEADQUARTERS, IT IS ALWAYS BEEN IN FINLAND?>>HELSINKI.>>YES. SORT OF IN THE PAST, EXCELL HAS INVITED FOUNDERS TO LIVE IN LONDON IN A WAY THAT OTHER AREAS HAVE MANAGED AND HOW BREXIT POTENTIALLY CHANGES THINGS.>>HONESTLY, I CAN’T REMEMBER A SINGLE SITUATION WHERE WE ASKED A FOUND TER TO MOVE TO LONDON. I’VE BEEN HERE EIGHT YEARS. I DON’T REMEMBER. CLEARLY NOT SOMETHING WE WOULD PUSH. WE SOMETIMES BEG FOR BOARD MEETINGS TO HAPPEN IN LONDON BUT NO, NEVER.>>IN EUROPE, YOU HAVE THE DEPTHS OF TALENT TO CREATE PRODUCT AND ENGINEERING. THERE IS NO REASON. WHY SHOULD THEY MOVE TO LONDON.>>WITH THE U.S., IT IS DIFFERENT. ESPECIALLY WITH SOFTWARE COMPANIES, EVERY DOLLAR SPENT ON SOFTWARE ON EARTH, 50 CENTS GETS SPENT IN THE U.S. IF YOU WANT TO WIN GLOBALLY, YOU’VE GOT TO BE THERE. SO WE HELP PEOPLE MOVE TO THE U.S. WE’VE BEEN DOING THIS FOR 35 YEARS. WE HAVE OFFICES IN MANY LOCATIONS. WE ARE IN THE BEST POSITION TO HELP COMPANIES DO THAT.>>YOU ASKED ABOUT BREXIT.>>IT IS INTERESTING, TWO YEARS AGO, WE ARE ASKING OURSELVES, WHAT IS THE AREA BREXIT WILL HAVE AN IMPACT ON STARTUP. FIRST ONE IS OF COURSE IMMIGRATION AND HIRING TALENT AND MOVEMENT OF TALENT IN EUROPE. IF COMPANIES DON’T MOVE HEADQUARTERS TO LONDON, THEY’LL HAVE TO BUILD A TEAM OR LOCAL CELL ORGANIZATION OR BUILD A SITE THERE. FOR FINTECH, THERE IS THE LICENSES. LONDON WAS A HUB FOR FINTECH AND IT WAS EASY TO OPERATE ALL OVER EUROPE. WHAT ABOUT THAT?>>THERE IS A QUESTION ABOUT DATA DEPENDENCY. WHERE THAT DATA IS STORED IS CRITICAL. YOU HAVE LOADS IN THE EU. IF THE UK IS OUT OF IT, THAT MEANS EVERY COMPANY WILL NEED TO HAVE A SEPARATE DATA CENTER IN THE UK OR MANAGE DATA SEPARATELY. THE FOURTH AREA IS PROBABLY LESS IMPORTANT BUT YOU CAN’T IGNORE, THAT IS THERE ARE A LOT OF INVESTMENT SUBSIDIES FROM THE EUROPON UNION AND R&D AND HOW WILL THIS IMPACT STARTUP. WE ARE STILL NO CLUE ON WHAT IS GOING TO HAPPEN? THE ANSWER IS JUST, I DON’T KNOW.>>I APPRECIATE YOUR CONDOR ON THAT. PEOPLE SAYING, NOTHING IS GOING TO CHANGE. OBVIOUSLY IT WILL. >>NOT ONLY FOR THE STARTUPS BUT ALSO FOR — I’M NOT A UK CITIZEN.>>SURE. ANOTHER THING I WANTED TO TALK ABOUT TODAY. IT IS SUCH A BIG STORY IN THE U.S., I IMAGINE IT IS HERE AS WELL. SOFT BANK’S VISION FUND WHICH IS VERY FUNDAMENTALLY CHANGING THE WAY BUSINESS VENTURE WORKS ESPECIALLY WITH TALK OF POTENTIALLY A SECOND FUND BEING RAISED AT SOME POINT. I’M WONDERING WHETHER YOU THINK ON THE WHOLE IF YOU THINK ON 0 THE GOOD OR BAD TREND, WE’VE SEEN OVER RESENT YEARS COMPANIES STAYING PRIVATE LONGER AND LONGER AND THIS SORT OF EXACERBATES THAT TREND. I DON’T KNOW IF THIS IS A GOOD THING OR A BAD THING.>>IT IS A GREAT THING TO HAVE MORE MONEY FOR A EUROPEAN SYSTEM IF THERE IS MORE MONEY, THERE IS MORE OPPORTUNITY FOR BUSINESSES TO BE FUNDED. IT CHANGES THE DEMAND IN THE MARKET. THE WAY IT CHANGES IS AS FOLLOWS. THEY ARE MORE LATER ORIENTED FUNDING. THE TYPICAL THING FOR THESE IS TO GO A LITTLE BIT EARLIER. THEY NEED TO GO EARLIER TO ACCOMMODATE THE AMOUNT OF MONEY. THEY OFTEN INVOLVE THE MONEY IN THE FINTECH BUSINESS. FOR THEM TRANSPARENCY WAS VERY IMPORTANT THEY HAD THE OPPORTUNITY TO TAKE ON A LATE STAGE INVESTOR OR GO PUBLIC. IN SOME CASES, IT’S A PERFECT FIT. IN OTHER CASES, THEY SAY, I’LL GO PUBLIC INSTEAD BECAUSE IT FITS MY FUTURE BUSINESS MODEL.>>RELATING TO SOFT BANK. ANOTHER DISCUSSION IN SILICON VALLEY IS WHERE IS THEIR MONEY COMING FROM. THEY USED TO NOT NEED TO THINK ABOUT IT BECAUSE THEIR INVESTMENT COMES FROM DIFFERENT MEANS OF INVESTMENT. SAUDI ARABIA SPECIFICALLY HAS BEEN IN THE HEADLINES BECAUSE OF THIS MURDERED SAUDI JOURNALIST JAMAL KHASHOGGI. IT HAS RAISED QUESTIONS OF WHETHER OR NOT TO TAKE MONEY FROM SOFT BANK BECAUSE SAUDI ARABIA IS HALF OF THE FUND. IS THIS SOMETHING YOUR FOUNDERS ARE TALKING TO YOU ABOUT?>>I THINK THE ANSWER IS, NO. NOT AT ALL. THIS QUESTION IS NOT BEING ASKED.>>REALLY?>>FOR THE RIGHT KIND OF COMPANY, SOFT BANK CAN ANOINT YOU A LEADER. THE WORLD IS IN SUCH A RACE, EVERYTHING IS MOVING SO FAST. LEADERSHIP AND CAPITAL MATTERS SO MUCH. I FEAR TO SAY, FORESOME OF THESE COMPANIES, IT MATTERS AT THE REQUEST OF SOME OF THESE CORE COMPANIES OF WHERE DOES THE MONEY COME FROM AND THE CO-QUESTION AND WHO IT IS ACCOUNTED TO.>>YOU ARE SAYING IT IS IMPRACTICAL.>>IN A PLACE EVERYTHING IS MOVING RIGHT. PEOPLE HAVEN’T SEEN A CYCLE. A LOT OF THE GREAT COMPANIES THAT WERE ALL INVOLVED AND HAVE MANAGEMENT TEAMS THAT HAVE BARELY SEEN A CYCLE. THERE IS NO CONCEPT OF, IT MIGHT FALL DOWN. LOOK AT THE DIFFERENCE OF WHAT IS HAPPENING IN THE VALUATIONS IN THE PRIVATE MARKET. >>FROM EXCELL, IS THERE ANYONE FROM WHOM YOU WOULDN’T TAKE MONEY.>>OH, NO. WE’VE BEEN YEARS IN BUSINESS. THE INVESTOR FUNDS IS OUR BASE.>>THE VAST MAJORITY OF INVEST INVESTORS INVEST WITH US. WHEN WE RAISE OUR NEW FUND, 95% ARE OLD INVESTORS.>>WE ARE RUNNING LOW ON TIME. ANOTHER TREND I WANTED TO TALK TO YOU ABOUT. A COMMON PATH TO LIQUIDITY NOW IS YOU VEST IN A OR B, YOU PROVIDE LIQUIDITY TO YOUR LIMITED PARTNERS. ARE YOU EXITING MORE OF YOUR DEALS THROUGH SECONDARIES?>>THERE DEFINITELY IS ONE. TYPICALLY, THE SECONDARY MARKET PROVIDES SOME LIQUIDITY TO FOUNDERS. WE ARE VERY LONG-TERM OBJECTIVE. TYPICALLY, THAT GOES THROUGH FOUNDERS. THAT TYPICALLY IS GOOD IF THEY TAKE A LITTLE MONEY OFF THE TABLE, THEY ARE ABLE TO GO BUILD I BIG COMPANY RATHER THAN SELL IT HALF WAY THROUGH THE PROCESS AND GET AN EXIT THERE. OUR BUSINESS IS ALL ABOUT BUILDING VERY LARGE COMPANIES. GENERALLY, IT IS GOOD.>>THIS HASN’T REALLY CHANGED IN THE PAST FIVE YEARS. WE HAVEN’T SEEN A BIG INCREASE ON THAT FRONT.>>OKAY. GREAT. AMOUNT OUT OF TIME. SOMALI, WHAT HAS BEEN THE FIRM’S BIGGEST MISS AND WHAT DID IT LEARN FROM THAT SCREW UP?>>WHY DID I GET THAT A MINUTE INTO IT?>>WE CARE A LOT ABOUT THE GREAT ENTREPRENEURS WE BACK BUT ALSO ABOUT THE ONES WE MADE A MISTAKE ON. PROBABLY FOR US AS A GROUP IN LONDON, THE GROUP WE WISH WE HAD BEEN A PART OF, WE WERE A PART OF SPOTIFY, THE NEXT WAS THE ADVANTAGE, THE DISADVANTAGE IS SOMETIMES WE ARE EARLY IN BUSINESS. WE WERE ERRORLY IN BRAIN TREE, WHICH WAS A BUSINESS WE SOLD TO PAY PAL. WE WORKED VERY HARD TO REALLY UNDERSTAND WHEN THE CONFLICT BECAUSE IT IS REALLY RARE THERE IS REALLY A CONFLICT. JUST ASSUMING THAT COMPANIES COMPETE. WE HAVEN’T REALLY EXERCISED THAT MUSCLE SINCE THEN.>>AT LEAST BRAIN TREE IS WITH PAYPAL. IT COULD HAVE BEEN WORSE.>>THANK YOU, CONNIE. >>THANK YOU FOR HAVING US.>>THANKS, EVERYONE.>>THANK YOU. OKAY. FOOD TRUCK TIME. LUNCH TIME. WE’LL SEE YOU AT 1:05. THANKS.>>THE PRO 2 IS THE NEXT ITERATION OF OUR POPULAR CAMERA SERIES. IT IS IMPORTANT TO GET THE FEEDBACK AND USE ON BOTH THE CAPTURE SIDE AND POST SIDE. OUR BIGGEST CHALLENGE TO THIS POINT IS HOW DO WE CREATE A SUPER SMOOTH WORK LOAD TO MAKE USERS HAPPY SO THEY DON’T HAVE TO PULL THEIR HAIR OUT IN THE STITCHING AND PROCESSING. WE HAVE TO LOOK TO ADDING THE FEATURES. WE’VE UPGRADED THE SENSORS AND MOTHER BOARD TO ALLOW FOR 8K STEREO CAPTURE. YOU ARE NOW ABLE TO RECORD HIGHER RESOLUTION WITH HIGHER FRAME RATES MAKING IT MORE IN LINE WITH WHAT THE TRADITION WOULD BE. THE DEFINING FEATURE IS THE DUEL INTEN AUS THAT POP UP. TO ENHANCE THE GPS AND WI-FI. YOU CAN NOW RECORD UP TO SIX SD CARDS. TO ALLOW UP TO 120 BITS PER SECOND ON EACH CARD. SO THE BIT RATE IS MUCH HIGHER THAN RECORDING ON TO JUST ONE SD CARD. IT HAS THE ABILITY TO STABILIZE. WE’VE UPGRADED THE GYROSCOPE AND RECHARGED OUR ALGARYTHM. THIS GOES FROM VR TO FILMMAKERS THAT WANT TO ENHANCE THEIR TOOL BELT. WE’LL BE COMPARING THE PRO 2 WITH OUR FAR SIGHT SYSTEM. IT IS THE FIRST LONG-RANGE BUILT FOR A 360 CAMERA. THE FAR SIGHT WILL BE AVAILABLE ON ITS OWN. TOGETHER, BOTH SYSTEMS ARE ABOUT $5,000.>>SO THIS GLORIOUS BEAST YOU SEE IS THE TREK SUPER COMMUTER 7. IT IS AN ELECTRIC BIKE WITH A PEDAL ASSIST. THE PEDAL ASSIST MAXES OUT ABOUT 20. MY FAVORITE PART. IT LOOKS LIKE SOME KIND OF URBAN ASSAULT BIKE. LET’S TAKE A CLOSER LOOK.>>I REALLY LIKE HOW THIS BIKE IS PUT TOGETHER. MASSIVELY IMPORTANT FOR A BIKE LIKE THIS. YOU CAN’T SWAP OUT THE BATTERY UNLESS YOU YOU ARE AT WORK. IT HAS THESE MASSIVE 2.4 TIRES. SHIMANO ON FRONT AND ALSO ON THE BACK. IT REALLY ASSISTS YOU ON THE PEDAL TO GIVE YOU A BOOST. SPORT MAKES YOU GO A LITTLE FAS FASTER TURBO MAKES YOU GO REALLY FAST. YOU COULD PROBABLY HAVE SOMEBODY PUSH YOU AROUND TOWN FOR FREE. IF YOU ARE INTO LONG COMMUTING, THIS IS THE WAY TO GO.>>WHAT IS UP TECH CRUNCHERS. WE ARE AT SKY HQ. WE ARE MEETING WITH A GROUP WORKING ON DRONES. LET’S CHECK THEM OUT.>>THE BASIC IDEA OF WHAT WE ARE DOING, WE THINK FULLY AUTONOMOUS DRONES ARE THE FUTURE. WE’VE BELIEVED THAT FROM THE BEGINNING AND WE BELIEVE THE CORE TECHNOLOGY THERE IS THE SOFTWARE SYSTEM. WE’VE REALLY BEEN FOCUSED ON BUILDING THAT FROM THE VERY BEGINNING.>>I’M SEEING A LOT OF PROTOTYPES BEHIND US. YOU WANT TO GIVE US A LONG OVERVIEW STRETCHING THROUGH WHERE THIS IDEA STARTED TRANSLATING INTO THIS NEW PRODUCT.>>FROM THE FIRST YEAR OF THE COMPANY, IT WAS JUST THREE COFOUNDERS WORKING IN A BASEMENT, SELF-FUNDED. THAT WAS VERY, VERY SCRAPPY. WE STARTED WITH QUAD COPTER FRAMES AND PUTTING USB CAMERAS ON THEM AND MOVING THE CORE OF OUR SOFTWARE SYSTEM. THERE HAS BEEN A STEADY MOVEMENT TO GET TO VR 1. WE GET MORE SOPHISTICATED RIGS THAT HELP US TO HAVE MORE SOPHISTICATED CAMERAS. WE HAVE ANSWERED THE QUESTION THERE, WE STARTED DEVELOPING THE CUSTOM PLATFORM. WE’VE BEEN THROUGH A NUMBER OF I HAD — IDERATIONS.>>THE FIRST PROTOTYPE WAS USING BASICALLY A MEDIA CENTER CAMERA. NOT DESIGNED FOR THIS. CAMERAS WERE OVER USB. NOT GREAT BUT IT ALLOWED US TO GET SOMETHING IN THE AIR, START DEVELOPING THE SOFTWARE. I THINK WE ARE FORTUNATE TO START DOING THIS IN OUR WHOLE TIME. WE STARTED THIS COMPANY AND NVIDIA ANNOUNCED THE GX 1. THAT’S WHAT WE STARTED USING. WE DID SORT OF THE OFF THE SHELF THING FOR A WHILE AND THEN STARTED WORKING WITH NVIDIA BOARDS.>>WHAT S UP WITH THIS MONSTER? THE PRETTIEST OF THE BUNCH.>>THIS IS THE TRIANGLE RIG. WE HAD ONE PROTOTYPE ENGINEER THAT WAS AWESOME. STILL FAIRLY CLUNKY, THIS IS THE FIRST THING WE HAD WITH MULTIPLE CAMERAS IN EVERY DIRECTION. THIS IS THE FIRST PROTOTYPE THAT WAS ALL OUR CUSTOM HARDWARE. IT IS NOT EXACTLY THE FINAL THING BUT PRETTY CLOSE. ALL THE BIG IDEAS WERE IN PLAY. IT WAS PRETTY CLOSE TO ALL OUR CUSTOM ELECTRONICS.>>WAS SIX PAIRS OF CAMERAS WHAT YOU YOU HAD TO HIT FROM THE FIRST PART?>>THE KEY THING WE HAD IN MIND. WE WANTED TRUSTWORTHY AUTONOMY. WE NEEDED YOU TO BE ABLE TO TRUST IT. ONE OF THE BUILDING BLOCKS IS HAVING STEREO PAIRS LOOKING IN EVERY DIRECTION. THAT HAS KCHALLENGES. THIS IS ONE OF THE REASON WE HELD THE PERIMETER.>>I WAS CURIOUS ABOUT THAT. WAS IT A DECISION FROM THE BEGINNING TO HAVE THE WINGS FOLD?>>IT WAS SOMETHING WE EXPLORED BUT WE STILL THOUGHT THIS WOULD BE A SUPERIOR PRODUCT. IT STILL FITS IN YOUR BACKPACK.>>SO AROUND THE LAUNCH, A LOT OF PEOPLE TALK ABOUT IT AS THE SELF FLYING SELFIE CAM. FOR A $2,500, CAN YOU SEE WHAT THE POTENTIAL SHAF ONE-LINER WOULD BE. IN THE FUTURE, ARE YOU A SELFIE CAM COMPANY.>>WE PROBABLY HAVE A MIXED RELATIONSHIP WITH THE WORD SELFIE. FIRST OF ALL, CAMERAS ARE EVERYWHERE. EVERY SMART PHONE HAS ONE — ACTUALLY EVERY SMART PHONE HAS AT LEAST TWO NOW. SOCIAL MEDIA IS DRIVEN BY PEOPLE TAKING AND SHARING PICTURES AND VIDEO. IT IS JUST A CORE PART OF OUR EXISTENCE NOW AND BECOMING MORE CENTRAL. MOST PICTURES AND VIDEO ARE TAKEN OF PEOPLE. PEOPLE ARE THE MOST INTERESTING SUBJECTS. CALL IT WHAT YOU WANT BUT WE THINK TF AS AN EVOLUTION OF THE CAMERA. OUR FIRST USE CASE IS TARGETED AROUND CAPTURING THE FIRST CONTENT OF PEOPLE DOING GREAT STUFF. WHEN PEOPLE TAKE PICTURES OF T THEMSELVES NOW, IT IS INTERESTING. THIS THING ALLOWS YOU TO CAPTURE THE STUFF YOU ARE MOST EXCITED ABOUT WITHOUT HAVING TO THINK OR WORRY ABOUT DID. IT IS HARD TO SAY WHAT THE CATEGORY WILL BE CALLED LONG TERM. WE THINK IT IS A REAL THING AND IT IS GOING TO BE PRETTY BIG. KIND OF THE CONSUMER MARKET QUESTIONS.>>THAT’S NOT A DRILL. THAT’S A PROTOTYPE. THS IS AN R1 THAT IS STRAPPED DOWN.>>A LOT OF THESE LOOK LIKE DRONE CHAMBERS.>>GOT IT.>>WE ARE HERE AT CREATOR. A NEW BURGER BOT RESTAURANT WITH THE CREATOR ALEX WHO CREATED THIS CRAZY THING. HOW DID YOU COME UP WITH THE IDEA.>>I GREW UP FLIPPING BURGERS. MY PARENTS HAD A RESTAURANT. I HAD FLIPPED 400,000 PLUS BURGERS. WHEN YOU ARE DOING THE SAME THING EVERY DAY, YOU REALIZE THERE IS A WAY TO A BETTER MEANS. THIS IS THE ULTIMATE KITCHEN INSTRUMENT. WE HAVE SAUCE AND 11 SENSORS. YOU GET AN ADVANTAGE ON A TEXTURE SIDE OF THINGS.>>THE BURGERS ARE TASTY AND I’M SURPRISED THEY ONLY COST $6.>>MY QUESTION IS WHAT WILL THIS DO FOR THE FUTURE OF WORK AND THE PEOPLE WHO WORK IN THE RESTAURANTS.>>I GREW UP FLIPPING MURGERS. HOW CAN I MAKE THE PLACE OF WORK TO SOMETHING MORE CREATIVE OR SOCIAL. THIS PLACE HAS A DECENT SIZE STAFF. WE ARE PAYING EVERYONE $16 AN HOUR. WE GIVE PEOPLE 5% TIME. 5% OF THE TIME ON THE CLOCK, THEY ARE SPENDING READING A BOOK OR DOING SOMETHING THEY ENJOY. WE ARE MOVING TO AN ENHANCEMENT OF OUR SKILL SET MOVING TO THINGS THAT ARE GENERALLY MORE FULFILLING.>>IF YOU WANT TO GO TRY THIS NEW BURGER. COME OUT TO 680 FULSOM, SAN FRANCISCO. WE’LL SEE MORE EVEN KIOSK SIZES COMING SOON.>>EATING BURGERS ALL DAY LONG. WE ARE LIKE, ARE YOU SICK OF BURGERS YET?>>PEEK DESIGN HAS A PRETTY INTERESTING FOUNDING STORY INVOLVING KICKSTARTER. HOW DID YOU START ALL OF THIS?>>I JUST WANTED TO MAKE A THING, WHICH IS THE CAPTURE CAMERA CLIP, WHICH IS A SMALL DEVICE THAT WOULD ALLOW YOU TO TAKE THE SMALL CAMERA, SLR TO ATTACH TO A BACKPACK. IT WAS A COOL IDEA. YOU GOT THAT FUNDED ON KICKSTARTER. A FEW MORE PRODUCTS ON KICKSTARTER AND THEN IT WAS THE BAG?>>YES. THE FIRST PRODUCT WAS A HIT. >>IT WAS THE SECOND MOST FUNDED PRODUCT OF ALL TIME. IT GOT THE BALL ROLLING. I WAS ABLE TO HIRE SOME PEOPLE. ONCE YOU HAD YOUR CAMERA NOT ON A STRAP, IT IS SORT OF DANGEROUS. WE INVENTED A WAY OF ATTACHING AND REMOVING STRAPS. WE WENT TO CLIPS THERE. FOUR YEARS IN, WE GOT A PRETTY GOOD FOLLOWING. FAMOUS PHOTOGRAPHER SAID I WANT TO MAKE A BAG WITH YOU GUYS. I OPENED THE BAGS. FORTUNATELY THE DESIGNER IS THIS MAGIC CALL, ONE OF THE BEST BAG DESIGNERS. SO WE ARE OFF TO THE RACES ON BAGS. WE ARE FOUR YEARS IN AND LOVING IT.>>TELL ME ABOUT THE DESIGN PROCESS HERE.>>SO AT PEEK DESIGNS, WE THINK OF OURSELVES AS A DESIGN STUDIO FIRST. BAGS ARE A LARGE PART OF OUR BUSINESS AT THIS POINT. WE TAKE A GROUND-UP APPROACH. THAT STARTS FIRST AND FOREMOST WITH A LOT OF RESEARCH INTO THE NEEDS WE ARE TRYING TO SOLVE FOR THE USER. WE GO AND SKETCH. THE BACKPACK WAS AN EVOLUTION OF THE MESSENGER BAG. SO PULLING THE SAME HARDWARE CUES. ONCE YOU HAVE A HE DESIGN, DO YOU TEST MATERIAL AND SEWING AND THINGS HERE IN-HOUSE.>>PRIMARILY, WHAT WE ARE DOING IS THE DEVELOPMENT OF ALL OF THE MATERIALS. WE DO A LOT OF GROUND UP DEVELOPMENT ON FABRICS. OUR HARDWARE, WE HAVE A ROBUST DESIGN TEAM. WE HAVE FREE PRINTERS AND THE SHOT. WE DO A LOT OF CAD WORK. SEWING WISE, WE ARE DOING A LOT OF ROUGH ITEMS AND COMPLEX PROBLEMS.>>SPEAKING OF THE FINAL, HOW IS THAT PROCESS? WHERE IS THAT PROCESS? TELL ME ABOUT THAT.>>YOU YOU ARE MAKING THESE PROTOTYPES. YOU KEEP REVING AND REVING AND YOU HAVE THAT GENERAL DESIGN. FROM THEN, IT IS THIS SUBTLE REFINEMENT PROCESS UNTIL WE GET WHAT WE CALL A GOLDEN SAMPLE. THAT IS A MASTER SAMPLE OF WHAT WE ARE GOING TO GO TO MARKET AND PRODUCTION WITH. >>WHAT DOES THE FUTURE HOLD?>>WE ARE BUILDING THINGS THAT PEOPLE WHO WORK FOR THIS COMPANY WANT. CERTAINLY, THERE IS GOING TO REMAIN A FOCUS ON CAMERA ENGIGEAR. SOME REALLY CORE ELEMENTS OF PHOTOGRAPHER SET UP. WE ARE NOT MAKING CAMERAS, WE MAKE ACCESSORIES. WE ARE VERY AWARE OF THE FACT THAT CAMERA INSIDE YOUR POCKET, WHICH IS YOUR iPHONE OR GALAXY OR PIXEL IS A PRETTY DAM GOOD CAMERA TOO.>>WE MAY SEE A LITTLE CAMERA CASE.>>TELL US ABOUT YOUR LATEST BABY?>>THIS IS THE 30 LITER BLACK BACKPACK.>>IT LOOKS SLICK. >>WHEN YOU PUT THINGS IN ALL BLACK, SLICK IS WHAT COMES TO MIND. A LOT OF PEOPLE ARE GETTING OUR 20 LITER PACK. THEY WANTED MORE. OUR HANDS WERE TIED. WE HAD TO MAKE IT IN A 30 LITER VERSION.>>HOW MUCH WILL THIS COST.>>$289. I BAWK AT A $200 BACKPACK. IT FEELS LIKE THE RIGHT PRICE. WE FEEL REAL GOOD ABOUT IT BEING PRICED THERE. SNET ♪. >>TBEER BOX IS A VENDING EXPERIENCE THAT DISTRIBUTES AN OPENED BEER TO ELIMINATE A LINE. IF YOU GO TO A FESTIVAL, YOU ARE LIKE, DO I REALLY WANT TO GO GET THAT NEXT DRINK? I MIGHT MISS THE THIRD QUARTER. THESE VENUES WOULD LOVE TO SELL MORE BEER BUT THEY ARE LIMITED WITH REAL ESTATE. THEY CAN’T BUILD MORE BARS IN THE ARENA NOR DO THEY NECESSARILY WANT TO HIRE MORE PEOPLE. THE BEAUTY OF THE DESIGN IS THAT WE CAN HAVE FOUR OR SIX OF THESE TOGETHER. YOU CAN HAVE ONE WORKER THERE TO CHECK I.D.S. IT IS KIND OF LIKE SELF CHECK OUT AT THE GROCERY STORE OR HOME DEPOT. IF YOU EVER BEEN TO A BALLGAME OR CONCERT. A LOT OF MUSICIANS WOULDN’T PERFORM WITH CLOSED CONTAINER. YOU GET IT AS A DRAFT OR THEY OPEN IT FOR YOU BECAUSE A CLOSED CAN IS A PROJECTILE. WE’VE MADE A BAR OUT OF IT. THEY HANG OUT AT THE MACHINE. THEY EAT FOOD OFF OF IT. THEY ALMOST ATTRACT MORE CONSUMERS. IT IS ALMOST LIKE A MAGNET. THE TABLETOP BECOMES A GREAT MARKETING CHANNEL FOR US AS WELL.>>COMMON SENSE ROBOTICS IS THE FIRST ROBOTICS COMPANY WITH THE LAST MILE IN MIND. WE DO MICROFULFILLMENT THAT DO FULFILLMENT FOR E COMMERCE AND GROCERY SPACE.>>THERE ARE A LOT OF MOVING PARTS. CAN YOU TELL ME WHAT IS HAPPENING WHEN YOU ORDER SOME EGGS FOR INSTANCE. >>WHAT WILL HAPPEN IS, YOU ARE GOING TO ORDER YOUR EGGS. WE GET THE ORDER IN OUR CENTER. THE ORDER WILL SEND TASKS TO ROBOTS. WE HAVE MULTIPLE TYPES OF ROBOTS IN ORDER TO GET YOUR ORDER PICKED.>>IF YOUR EGGS WERE PART OF A 60 ITEM ORDER THARKS WOULD BE PICKED IN AS LITTLE AS TEN MINUTES. THE FACILITY WOULD BE LOCATED IN CENTERS OF CITIES SO IT CAN GET TO YOU WITHIN AN HOUR.>>TELL ME MORE. IT IS CUTE TO SEE THEM MOVING AROUND. ARE THEY SMART? HOW DO THEY KNOW WHERE THEY ARE SUPPOSED TO BE?>>THE GROUND ROBOTS ARE ACTUALLY KIND OF STUPID. THAT IS BY DESIGN. THEY KNOW TO GO STRAIGHT. REALLY THE RAIN IS THE BASE, WHICH IS WHERE WE HAVE A VIRTUAL SITE. THAT BRAIN SENDS THE ROBOT TASK. THEY FILL THE TASK.>>WHEN THEY FILL THE TASK, THEY PICK UP THIS BIG BLUE BOX FILLED WITH PRODUCT.>>HOW DO YOU KNOW WHERE THE PRODUCT ARE AND HOW TO PICK THEM UP.>>ANY PRODUCT THAT GOES INTO OUR FACILITY GETS SCANNED WITHIN A SPECIFIC TOTE AND WITHIN A SPECIFIC VIN. OUR SYSTEM KNOWS FOR EVERY PRODUCT THAT CAME IN WHERE IT IS LOCATED. IT CAN CONSTANTLY MANAGE IT TO MOVE IT AROUND. IT CAN THINK, YOU ARE A FAST MOVER, I’LL TAKE YOU TO THE TOUCH TIME.>>HOW DOES IT WORK, ARE YOU BUYING ROBOTS OR A NEW SERVICE.>>CUSTOMERS WOULD COME INTO AGREEMENT. THEY PAY US ON A PER ITEM BASIS AND WE FILL FOR THEM. WE TAKE CARE OF ALL THE REST. EVERYTHING INVOLVED TO MAKE SURE THE CUSTOMER GETS THEIR PERFECT ORDER. >>WHY DID YOU THINK ABOUT THIS SERVICE APPROACH INSTEAD OF THE ELECTRONIC APPROACH?>>IT IS JUST THOUSAND, HOW WE CAN EXPAND THE MARKET IN A WAY PLAYERS CAN’T.>>TWO YEARS AGO, DGI TRANSFORMED THE BUSINESS WITH THE FOLDABLE MAVERICK PRO. SINCE THEN, THEY’VE ADDED OTHER ITEMS. INTRODUCED LAST WEEK, THE MAVERICK 2 PRO DOESN’T INTRODUCE AN UPGRADE BUT DOES HAVE IMPROVEMENTS. THE COMPANY OPTED TO PROVIDE TWO DIFFERENT SKUS. THE FIRST TO SUPPORT THE CAMERA AND THE FIRST IN LINE TO PROVIDE OPT CALL ZOOM. UNFORTUNATELY, THE SWAPPABLE DIDN’T SHOW UP THIS TIME OUT. FOR MOST USERS, THE CHEAPER ZOOM IS MORE THAN SUFFICIENT. IT HAS SOME COOL EFFECTS. FLYING THE DRONES IS FAIRLY SIMILAR TO THE PREDECESSORS. SOME TWEAKS DON’T MAKE MUCH OF A DIFFERENCE SAY FOR A FEW MINUTES OF BATTERY LIFE. WE DID MANAGE TO CRASH INTO A TREE ONCE IT WAS OUT OF OUR SIGHT. IT IS NOT ENOUGH TO JUSTIFY AN UPGRADE. THEY ARE AVAILABLE NOW STARTING AT $1249 AND $1449 RESPECTIVELY. ♪>>THIS IS A MADE TO MEASURE PLATFORM WHERE WE SPECIALIZE IN MAKING WARDROBES. I WAS THAT KID IN TERMS OF STYLE AND COLOR, I WAS SUPER DELIBERATE ABOUT WHAT I WORE. I COLLECTED JORDANS. I WANTED TO BE FASHIONABLE BECAUSE I JUST CARED. THAT INSPIRED ME TO GO OUT AND LEARN PATTERN MAKING. MEETING SUPPLIERS AND FIGURE OUT HOW THE PROCESS WAS DONE AT A HIGH LEVEL AND A RESPECTABLE LEVEL. SO IT WAS AN ATTEMPT AT FULFILLING AN ENTERPRISE SOFTWARE COMPANY IN 2015. THAT DIDN’T GO AS PLANNED, WHICH WAS GOOD. IT PUT ME IN A POSITION TO SAY, HEY, YOU GOT TO FIGURE OUT WHAT YOU CAN DO BEST AND WHAT FEELS NATURAL AND COMFORTABLE. YOU CAN GUIDE THIS PROCESS WITHOUT RELYING ON OTHERS TO MAKE YOUR DREAM COME TRUE.>>HEY, ALL RIGHT. SO, THIS IS THE LOOK THAU CHOSE FROM THE FITS APP, WITH A FEW UPDATES PER YOUR REQUEST. THE LINING OF THE INSIDE OF THE JACKET IS A NICE CURRENT COLOR. THE LAST BUTTON HOLE, SLEEVE THREAD MATCHING THE INSIDE LINING.>>OH. SHOOT. WHAT?>>THE MUSIC ASPECT CAME UP ABOUT A GOOD YEAR AGO. WE WERE JUST TRYING TO UNDERSTAND WHAT IS IT THAT PEOPLE — WHAT ARE THEY GRASPING ON WHEN THEY SAY, HEY, I’M LOOKING FOR SOMETHING BUT I JUST DON’T KNOW WHAT IT IS. WHEN THERE IS IMPULSE BUYING, THERE IS SOMETHING DRIVING THAT. THE MUSIC PIECE IS WHAT WE’VE DETERMINED DRIVES A LOT OF OUR CULTURAL UNDERSTANDING. OUR PURCHASING HABITS. THINGS OF THAT NATURE. SPOTIFY ALLOWS US TO LEARN WHAT OTHERS ARE DOING IN REAL TIME. THAT IS VERY VALUABLE. IT IS A DISCOVERY TOOL. WE CAN UNDERSTAND MORE BEYOND YOUR TRANSACTIONAL DATA. IT PUTS A LITTLE MORE OWNNESS ON US TO BE AN ACTUAL TASTE MAKER PLATFORM.>>WE ARE GOING FOR IT. WE ARE SWINGING FOR THE FENCES EVER SINGLE DAY. OVER TIME, WE’LL GROW AND BECOME MORE TECHNICAL, PRODUCT SAVVY AND GROW IN SAN FRANCISCO.>>CARRY ON. READY TO GO. THANK YOU.>>JUST WALKING OUT OF HERE WITH A SUIT.>>THERE YOU GO.>>ABOUT FOUR YEARS AGO, FETCH STARTED. WE KIND OF CAME IN THE MARKET WITH A VISION. NOT ONLY TRANSFORMING GOODS WITH THE ROBOT BUT PICKING WITH THE ROBOT. BEING ABLE TO MOVE PIECES AND CASES WITH PAL LOTS. WE HAVE A 100 KILL OWE GRAM ROBOT, 500 KILOGRAM ROBOT. WE HAVE DIFFERENT MODULES ON TOP. IT PROVIDES INTENSE UNIT. WE BUILT THE HARDWARE ON TOP. WE HAVE DIFFERENT MODULES. WE HAVE AN RFID MODULE THAT ALLOWS YOU TO FIND ITEMS. WE ALSO HAVE NEWER ACCESSORIES LIKE PUTTING THE CONVEYOR TOP. WE KOL IT A ROLLER TOP. YOU CAN MOVE CARTS AROUND AND WE MOVED TO LARGE PLATFORM. THEY HAVE ON BOARD INTELLIGENCE THAT HELPS THEM AVOID EACH OTHER. IT ALLOWS US TO DEPLOY SYSTEMS TO CUSTOMERS IN ABOUT EIGHT HOURS AND CON FIGURE WITHOUT KNOWING MUCH OF ANYTHING ABOUT ROBOTS. AMAZON PRIME HAS RAMPED UP THE FIER FIERCITY TO GETTING PRODUCT TO PEOPLE FASTER. THERE WERE A LOT OF MARKET FACTORS THAT REALLY MADE MANUFACTURING AND WAREHOUSING AN IDEAL MARKET FOR ROBOTICS. THE PROBLEM IS SOLVABLE. ROBOTICS IS CALLED A SEMISTRUCTURED ENVIRONMENT. YOU KIND OF KNOW WHAT IT LOOKS LIKE AND THE FACTORS, THE PEOPLE INSIDE THAT ENVIRONMENT ARE FINANCIALLY INCENTIVIZED TO BEHAVE THEMSELVES. IF YOU HAVE A ROBOT DRIVING AROUND, NO ONE IS GOING TO JUMP OUT IN FRONT OF IT AND SAY, HEY ROBOT, DID YOU FIND ME. IT LOOKED LIKE A REALLY RETRACTIBLE PROBLEM. THERE WERE A LOT OF OTHER STRANGE MARKET INDICATORS. EVERYONE TALKS ABOUT ROBOTS AND JOBS BUT THERE IS A MASSIVE LABOR SHORTAGE. ABOUT 600,000 UNFILLED POSITIONS. IF YOU GO TO ANY CONFERENCE TODAY FOR MATERIAL HANDLING AND LOGISTICS, ALL YOU’LL HEAR IS, I CAN’T FIND ENOUGH PEOPLE TO DO THE JOBS. IT IS THE NUMBER ONE FACTOR PEOPLE TALK ABOUT WHEN IT COMES TO ROBOTS AND JOBS AND JUST LABOR IN GENERAL.>>WHY DON’T WE HAVE SOMETHING LIKE A DISHWASHER FOR FOLDING. WE HAVE A DRIER, A WASHER. WHERE IS THE DISHWASHER? THAT IS WHAT INSPIRED ME. FOLDING LAUNDRY WITH A MACHINE IS A PAIN. FABRIC IS REALLY DIFFICULT FOR ENGINEERS. IF YOU THINK ABOUT IT, YOU HAVE SO MANY TYPES OF ITEMS IN YOUR LAUNDRY AND SO MANY FABRIC TYPES, YOU NEED TO MAKE A TECHNOLOGY THAT WILL HANDLE THEM TOGETHER. NOT ONLY HANDLE THEM BUT FOLD THEM IN A REASONABLE QUALITY AND SPEED AND DON’T FORGET THE PART OF COST AND SIZE. YOU HAVE A LOT OF MACHINES THAT ARE INDUSTRIALIZED AND ROOM SIZE. THEY COST TENS OF THOUSANDS OF DOLLARS AND USUALLY THEY CAN ONLY FOLD ONE ITEM VERY WELL. WE ARE DOING THE MAJORITY OF ITEMS IN AN AVERAGE LAUNDRY LOAD. SHIRTS, TOWELS, PANTS, EVEN PILLOWCASES. ALL THE SMALL ITEMS LIKE UNDERGARMENTS, AND LARGE ITEMS LIKE LINENS. THEY ARE NOT IN OUR FOCUS. THE LARGE BECAUSE THE MACHINE HAS TO BE LARGER. THE SMALL BECAUSE I THINK WE CAN DO IT FASTER BY HAND. WE’VE HAD MULTIPLE PROTOTYPES ALONG THE WAY. THE LAST ONE, THE HOME VERSION, WE’VE BEEN WORKING ON IT FOR TWO YEARS ALREADY. WE ARE AIMING TO LAUNCH THE FIRST UNIT CLOSE TO 2019. IT IS REALLY CHALLENGING, WE ARE TRYING TO MAKE THAT DEADLINE. AS YOU KNOW, THIS IS A DEVELOPMENT STAGE. RIGHT NOW, STILL ON TARGET, END OF 2019.>>SPART IS A HUMAN RESILIENCE PLATFORM WHERE WE STARTED TO REDUCE RISK MEASURES HOW MUCH FORCE, PRESSURE IS IN THE GROUND. FROM THAT PATTERN, WE’VE BEEN ABLE TO IDENTIFY AND PREDICT AND REDUCE INJURIES MOSTLY IN ATHLETES. WE HAVE MOVED TO THE MILITARY AND NOW TO MEDICINE. WE USE THE JUMP. FROM THAT JUMP TEST TH, THAT FO ON THE GROUND THAT SHOWS THE PATTERN AND REDUCES INJURY TO THE UPPER BODY. THERE IS A LOT OF BOUNCE OUT THERE. THE FORCE PLATES HAVE BEEN AROUND FOR DECADES. IT IS REALLY THE DATA SCIENCE THAT ALLOWS US TO DO SOMETHING UNIQUE. WE ARE LOOKING FOR SOMEBODY TO MAKE US BETTER. PLAYGROUND HARDWARE WAS SOMETHING THAT APPEALED TO US. THAT’S WHY WE STARTED THE RELATIONSHIP WITH PLAYGROUND.>>YOU HAVE ALL OF THESE NEGATIVE STEREO TYPES AGAINST PEOPLE FROM OAKLAND. THEY MAKE SURE YOUR SCHOOL IS FIRST. THEY MAKE SURE YOU ARE DOING GOOD AT EVERYTHING AND CHECK IN ON YOU.>>WE ARE DOING OTHER THINGS. I COULD BE HERE OR I COULD BE IN THE STREET, WORKING OUT.>>GUARDIAN IS A 501 C3 THAT GIVES KIDS AND OPPORTUNITY FOR JUJITSU AFTER SCHOOL. I WAS DOING THE BIG BROTHER, BIG SISTER PROGRAM. I HAD A LITTLE BROTHER, HE WAS 11 YEARS OLD. HE WAS A GREAT KID. WHAT I KEPT THINKING IS WOULDN’T IT BE COOL IF HE LOVED TO DO THIS AND WE COULD MEET AT THE GYM. THE COMBINATION OF REALIZING THAT PEOPLE COULDN’T AFFORD IT AND PEOPLE LIKE ME REALLY WANTED TO VOLUNTEER AND GIVE BACK. IT MAKES IT REALLY EASY FOR FOAM VOLUNTEER, MENTOR AND GIVE BACK.>>I WORKED AT TWITTER FOR THREE YEARS. I ABSOLUTELY LOVED WORKING THERE. I WAS THERE BEFORE THE IPO. I WORKED WITH SOME OF THE BIG CONTRACTS. IT WAS A REALLY TOUGH DECISION TO QUIT. WHAT IT CAME DOWN TO ME, WE CAME THAT CRITICAL MASS, THAT OPPORTUNITY I HAD TO GO ALL IN ON.>>I THINK AT TWITTER IS WHERE I LEARNED THAT CULTURE. HE TALKED TO PEOPLE. EVERYONE BELIEVED HE WAS THEIR FRIEND. I KNEW WE NEEDED TO CREATE A SIMILAR TECH CULTURE.>>GENTLEMAN, PLEASE TAKE YOUR SEATS. THE PROGRAM WILL BEGIN IN TEN MINUTES.>>I HAVE REALLY MIXED THOUGHTS, HONESTLY ABOUT WHAT THE TECH WORLD HAS DONE TO THE BAY AREA. THERE IS THE OBVIOUS THINGS WE ALL WORRY ABOUT. SPECIFICALLY THINGS LIKE THE PRICE OF HOUSING GOING UP. IN GENERAL, IT PROVIDES DECENT MIDDLE CLASS JOBS. THERE IS THAT ELEMENT THAT IT IS CHANGING OUR COMMUNITIES. IT IS NOT GOOD FOR EVERYBODY. IN SOME WAYS, THIS IS A SMALL STEP TO MAKING AN IMPACT. AS SO MANY PEOPLE TALK ABOUT THAT TODAY, ONE OF THE REASONS THERE IS NOT MUCH DIVERSITY IS IT COMES FROM REFERRALS. IT BECOMES VERY HARD TO GET IN FRONT RIGHT PEOPLE AND GET THE RIGHT JOB.>>ONE OF THE GUYS THAT USED TO DO JUJITSU HERE. HE HAD A RESTAURANT. HE COMES AND DONATES FOOD. IT WAS SUPER TIME. I HAD NOTHING TO DO. HE OFFERED ME A JOB. I TOOK IT. I WAS A PREP COOK. I WORKED AT HIS RESTAURANT FOR ABOUT TWO MONTHS.>>THE CHILDREN HERE ARE SO EAGER TO LEARN BECAUSE THEY WEREN’T RAISED AS ATHLETES OR LIKE THEY’VE BEEN BOXING SINCE THEY WERE 10 OR 11. A LOT OF THEM ARE WALKING IN AND THEY DON’T HAVE THE SAME LEVEL OF COMFORT. THE THING WITH GUARDIAN BEING FREE, IT IS WAY MORE WELCOMING THAN ANY OTHER GYM I’VE BEEN IN OR SEEN. SOME OF THE KIDS WALK IN FROM DIFFERENT PARTS OF LIFE AND THEY WANT TO EMBRACE IT MORE. >>WE ARE TEACHING THEM HOW TO PUNCH AND GRAPPLE. BUT WE ARE DEALING WITH IMMIGRATION ISSUES AND THEIR FAMILY AND POOR ACADEMICS AT SCHOOL. WE ARE DEALING WITH TEEN PREGNANCY AND PRESSURE TO JOIN GANGS.>>I ACTUALLY STARTED COMPETING LAST YEAR. I DID THREE TOURNAMENTS. I HAVE ANOTHER ONE NEXT MONTH. >>HOW DID YOU DID?>>I GOT TWO SECOND PLACES. I USED TO WANT TO A LONG TIME AGO BUT I DIDN’T BECAUSE YOU HAD TO PAY. WHEN I FOUND OUT ABOUT THIS GYM, I WAS LIKE, OKAY. THAT’S GREAT. >>ONE OF THE MOST COMMON THINGS IS, OH, YOU YOU ARE TEACHING KIDS HOW TO FIGHT. THAT’S TRUE. THEY COME IN HERE OVER AND OVER. TAKE A 16-YEAR-OLD BOY. THEY DO A FEW CLASSES AN REALIZE, HOLY CRAP, I DON’T KNOW ANYTHING. IT REALLY SHAVES THAT FALSE CONFIDENCE OFF AND THEY HAVE TO START BUILDING FROM THE GROUND UP.>>WHEN YOU GIVE A PERSON WHO HAS NOTHING, WHEN YOU GIVE THEM SOMETHING, THEY ARE MUCH MORE INTUNED. THEY WANT TO DEVELOP THAT AS OPPOSED TO GETTING MORE. I CAN BE WHAT I WANT TO BE BECAUSE I UNLOCKED MY POTENTIAL INSIDE ME. >>IT IS ABOUT SELF-CONTROL. IT IS ABOUT RESPECTED YOURSELF AND YOUR NEIGHBOR AND PUTTING EXPECTATIONS ON THE DAILY PERFORMANCE OF A YOUNG ADULT AND SAYING YOU WILL BE THIS THING, THIS EMBODIMENT OF INTEGRITY OR YOU WILL NOT BE A PART OF OUR COMMUNITY.>>WEI DO HAVE A FOOD PROGRAM RIGHT NOW FOR KIDS. WE HAVE A FEW PROGRAMS THAT DONATE FOOD AND THE KIDS CAN EAT AFTER TRAINING. WE HAVE A TUTORRING PROGRAM. WE ARE DOING THE SAME THING MANY OTHER NONPROFITS AND PARENTS ARE TRYING TO DO. TRYING TO GET THEM TO GET BETTER GRADES. WE ARE USING MARTIAL ARTS AS A BRIDGE TO GET THERE.>>SO ABOUT A WEEK AGO, I FOUND THIS VERY COOL BLOCKCHAIN PROJECT. IT IS THE BLOCKCHAIN TERMINAL. YOU ARE THE HEAD OF PRODUCT FOR THIS MONSTER HERE. TELL ME ABOUT THIS PROJECT AND HOW IS THIS DIFFERENT FROM ON LINE PROGRAMS? THE WHOLE SCOPE IS TRYING TO BUILD A TERMINAL LIKE WHAT MARKETS ARE USED TO TODAY. PROVIDE A CONSOLIDATED VIEW OF A VERY DECENTRALIZED MARKET. THE LOWER PORTION IS AROUND THE TRADING APPS, MESSAGING THE MARKET. THE UPPER PANEL IS MORE AROUND AN APP STORE, LIKE THE APPLE APP STORE WHERE WE CAN PUT THE APPLICATIONS IN. >>LADIES AND GENTLEMEN, PLEASE TAKE YOUR SEATS. THE PROGRAM WILL BEGIN IN FIVE MINUTES. >>SO THE CRYPTOCURRENCY MARKETPLACE — AS BEST WE CAN. >>WHY WOULDN’T YOU DO THIS IN A WEBSITE?>>I THINK PART OF IT HAS TO DO WITH OBVIOUSLY THE COMPLIANCE GUARD ASPECT OF OUR APPLICATION IS LOGGING ALL THAT INFORMATION INTO THE LEDGER — INTO THE PRIVATE LEDGER VIA RCG, BLOCKCHAIN APPLICATION. THAT’S WHY THE HARDWARE IS KEY TO THIS APPLICATION. >>SO ANY KEY STROKE ON HERE IS RECORDED SOMEWHERE. >>THAT’S THE GOAL. THAT’S THE ONLY WAY YOU CAN GET IT ON THE TRADER’S DESK?>>HOW IS THIS DIFFERENT FROM SOMETHING LIKE A BLOOMBERG — [ INDISCERNIBLE ]. >>THOSE ARE SHOWING CERTAIN ASPECTS OF THE MARKETPLACE, AND NOT TO THE LEVEL — [ INDISCERNIBLE ]. AN INSTITUTIONAL TRADER WANTS TO HAVE. DOESN’T MATTER THAT THEY DON’T, BUT I THINK THEY’RE FOCUSED ON THE CORE COMPETENCIES AND THIS IS BRINGING TRANSPARENCY INTO THE CRYPTOCURRENCIES AROUND THE WORLD. >>AND YOU TALKED TO THE TRADERS THEY WANTED A CURVED SET-UP GEM.>>WE’RE ALWAYS GATHERING FEEDBACK, WHAT THEY WANT. IT’S EARLY DAYS FOR US. WE HAVE CONCEPTUALLY TO UNDERSTAND WHAT TRADERS AND INSTITUTIONAL TRADERS WANT AND NEED TO HAVE. WE’RE GETTING FEEDBACK BACK AND WE’RE KIND OF MODIFYING THE ROAD MAP AS WE GO BASED UPON THE VOICE OF THE CUSTOMER AND HOW WE VALIDATE THEM.>>>I BELIEVE THAT SIDEWALKS ARE SACRED, YES. WE NEED TO CREATE TECHNOLOGY THAT INTERACTS WITH PEOPLE IN THE BEST WAY AS POSSIBLE. I’M PHILLIPPE AND THE FOUNDER AND CEO OF QE. RIGHT NOW WE ARE THE COMPANY THAT HAVE MORE — [ INDISCERNIBLE ] AND THE ONLY ONE DOING IT AT SCALE. WE HAVE DELIVERED MORE THAN 10,000 ORDERS. FROM THE RESTAURANT TO THE CUSTOMER’S HOUSE, WE FOUND OUT PRETTY FAST THAT WAS PRETTY INEFFICIENT. LIKE AS SOON AS YOU SENT IT FROM THE RESTAURANT TO THE CUSTOMER’S HOUSE, IT WOULD ARRIVE LATE AND WE CREATED A MULTIMODEL SYSTEM. SO WE HAVE A ROBOT INSIDE THE RESTAURANT. WE HAVE ONE THAT GOES IN THE STREETS. RIGHT NOW WE HAVE HUMANS DRIVING THEM AND WE HAVE THE QE BOX. SO WE’RE OPERATIONAL LIKE THIS. WE HAVE ROBOTS DEPLOYED IN THE CITY LIKE DEPENDING ON THE DEMAND IN THE ZONES AND THEN WE PICK UP ORDERS, DOZENS OF ORDERS FROM THE RESTAURANTS. >>LADIES AND GENTLEMEN, PLEASE SILENCE ALL MOBILE DEVICES. THE PROGRAM IS ABOUT TO BEGIN. >>RIGHT NOW, IT WORKS. THE TECHNOLOGY IS BASED ON COMMERCE. SO COMMERCE, SO WE USE HIGH END SENSORS. THAT HELPS US TO GO BEYOND LIKE — LIKE MOVING ON. SO IT’S HUMANS PLUS ROBOTS. WITH THAT, WE CAN ACTUALLY OFFER LIKE A MORE AFFORDABLE DELIVERY COST. AND MAKE SURE THAT LIKE THIS DELIVERY COMPANY AND SOCIETY CAN ORDER FOOD IN A SUSTAINABLE WAY. SO THE ROBOTS, FOR EXAMPLE, IF YOU’LL HAVE MORE ORDERS IN A SPECIFIC ZONE, THE ROBOTS CAN MOVE THROUGH THAT ZONE. DEPENDING ON THE MODEL WE TRY TO OPTIMIZE EVERY PLAN. WITH THE ROUTE, YES, SO THE ROBOTS WILL TRY ALWAYS TO — LIKE TO MAKE SURE THAT THE ROUTE IT IS AS FAST AS POSSIBLE. ONE OF THE CONCERNS WE HAVE IN THIS SPACE, WE’RE AT THAT POINT THAT AUTOMATION DOESN’T MAKE SENSE. HAVING HUMANS PLUS ROBOTS MAKE SENSE. AS SOON AS WE START — WE’RE PRETTY SURE THAT WE CAN AUTOMATE THINGS WE’LL DO IT. BUT BY NOW, WE’RE USING BOTH.>>>HELLO. I’M HERE — >>>LADIES AND GENTLEMEN, PLEASE WELCOME BACK TO THE STAGE TECHCRUNCH EDITOR AND DISRUPT EMCEE, JORDAN CROOK.>>SORRY ABOUT THAT. I’M HERE. YEAH. I’M FEELING REAL BIG. I’M JUST KIDDING. OKAY, WE ARE GOING TO TALK CARS NOW. JUST SHIFTING GEARS. SO OFTEN — I CAN OUTWAIT YOU. THERE WE GO. THANK YOU. ALL RIGHT. PLEASE WELCOME TO THE STAGE FROM SONO MOTORS, YOUR MODERATOR. ♪>>OKAY. THANKS FOR EVERYONE, I HOPE YOU HAD A GOOD LUNCH. THANKS SO MUCH FOR COMING, LAUREN AND OLA OF THE DISRUPT STAGE SO THANKS FOR COMING BACK. I WANTED TO KICK IT OFF WITH YOU. SONO MOTORS IS AN UNCONVENTIONAL CAR COMPANY WITH A LOT OF REALLY INTERESTING FEATURES SO I WAS HOPING YOU COULD GIVE US AN UPDATE ABOUT THE PROJECT. WHERE IT’S AT AND WHEN WE’RE GOING TO SEE A CAR. >>YEAH, SURE. HELLO, EVERYONE. I’M LAUREN AND I’M THE FOUNDER AND CEO OF SONO MOTORS AND WHAT WE DO IS TWO THINGS. WE ARE AN OEM PROUCING CARS AND SEMI-CARS, BUT ON THE OTHER HAND WE ARE A FULL SERVICE PROVIDER. AND THE FIRST — WHAT WE HAVE HERE IS THE FIRST CAR WE LAUNCHED IN — IT’S A SOLO CAR IT RECHARGES ITSELF. IT’S AN ELECTRICAL VEHICLE, 250 KILOMETER RANGE, AFFORDABLE, FAMILY FRIENDLY CAR. BUT IT RECHARGES ITSELF DURING STAND TIME. AND THAT’S AN INTERESTING FEATURE. >>I THINK WE HAVE A PHOTO OF IT IF WE CAN GET IT BACK UP ON THE SCREEN. >>YEAH. THAT WOULD BE COOL. >>YOU HAVE A RIDE SHARING ELEMENT AND A POWER SHARING ELEMENT TO IT. EXPLAIN THAT A LITTLE BIT. >>WHAT WE SAID IS THAT — THERE ARE A LOT OF CARS PRODUCED PER YEAR. APPROXIMATELY 80 MILLION CARS A YEAR. THAT’S JUST — YOU KNOW, IT’S A NUMBER, IT’S INCREDIBLE. SO WHAT WE SAID IS LAUNCHING AN ELECTRICAL VEHICLE IS THE ONE THING, BUT THE MORE IMPORTANT THING IS TO REDUCE THE AMOUNT OF CARS IN OUR CITY. SO WE INTEGRATED EVERY SIGN — [ INDISCERNIBLE ]. BY POWER SHARING. THAT’S REALLY INTERESTING. I THINK EVEN PROBABLY — [ INDISCERNIBLE ]. THE POWER SHARING IS OBVIOUSLY PUTTING — PUTTING ELECTRICITY BACK FROM THE BATTERY TO THE — SO ELECTRIC SCOOTERS, EVEN POWER UP THE HOUSE AND EVERYTHING LIKE THAT. THIS IS A VERY NEW THING. WHAT WE CALL POWER SHARING. >>SO THAT’S INTERESTING BECAUSE YOUR GOAL IS IN A WAY SIMILAR TO MOYA’S WHICH TO REMOVE CARS FROM THE ROAD, BUT MOYA IS TAKING A COMPLETELY DIFFERENT APPROACH WHICH IS RIDE POOLING. SO I’M WONDERING IF IN THE MOYA UNIVERSE THERE’S ROOM FOR A VEHICLE. >>THAT’S AN INTERESTING QUESTION. SO YEAH, WE ARE NOT IN THE OEM OBVIOUSLY. WE ARE WORKING TOGETHER WITH THE FOLKS IN THE GROUP. BUT WE ARE A MOBILITY ON DEMAND COMPANY. RIDE POOLING IS OUR FIRST PRODUCT AND IT’S A VERY SOPHISTICATED ONE. WE EVEN ADDRESSED — LIKE IN CITIES TO BETTER UTILIZE THE ASSETS AND THE VEHICLES SO WE ALWAYS TALK ABOUT THAT WE WANT TO GET RID OF EMPTY SEATS IN THE CITY. BUT OBVIOUSLY, WE ARE ALSO WORKING ON OTHER SERVICE CLASSES. WE CALL THE SERVICE CLASSES WHERE WE WOULD COVER OTHER AND MORE USE CASES OF PEOPLE THAT LIVE IN CITIES. SO WE ARE VERY OPEN TO ANY KIND OF SHARING AND MOBILITY ON DEMAND SERVICES THAT MIGHT BE OUT THERE. >>SO YOU ARE BUILDING A VAN RIGHT NOW, CORRECT? WHAT ARE THESE OTHER SERVICES THAT YOU’RE TALKING ABOUT BESIDES RIDE POOLING?>>I MEAN, OBVIOUSLY, SO WE CALL IT SERVICE CLASSES. I MEAN, RIDE POOLING IS A VERY EFFICIENT, A VERY AFFORDABLE, DEMOCRATIZED SERVICE. BUT YOU CAN THINK ABOUT MORE SERVICES THAT YOU WOULD POTENTIALLY NEED SOME ASSISTANCE IN CERTAIN CASES OR YOU WOULD LOVE TO TRAVEL ALONE IN THE SMALLER VEHICLE BECAUSE YOU HAVE TO DO SOME WORK OR PHONE CALLS OR WHATEVER. AND THESE KIND OF THINGS WE ARE CURRENTLY WORKING ON. >>OKAY. SO THE BASIC PREMISE IS STILL UNDER THAT RIDE SHARING PLATFORM. >>YEAH. >>BUT DIFFERENT FORM FACTORS. >>EXACTLY. >>BASICALLY — OKAY. INTERESTING. LAST YEAR WHEN YOU WERE ON STAGE YOU SAID THAT THERE WAS A GOAL OF REMOVING 1 MILLION CARS FROM ROADS BY 2025. SO I’M JUST WONDERING HAVE YOU MADE A DENT IN THAT YET? WE WANT A PROGRESS REPORT. >>I CAN UNDERSTAND THAT. WE’RE IN THE SECOND YEAR AND WE’RE IN EARLY DAYS BUT WE BROUGHT OUR FIRST COMMERCIAL FLEETS ON TO THE STREETS, STARTED COMMERCIAL OPERATION I THINK IN AUGUST — LAST AUGUST. WHERE WE NOW HAVE LIKE 50,000 CUSTOMERS WHERE WE HAVE LIKE A SHARING RATE AND THIS IS REALLY ENCOURAGING TO ME OF UP TO 60% IN PEAK TIMES SO THAT SHOWS THAT OUR SYSTEM IS WORKING OBVIOUSLY TO ACHIEVE THE OBJECTIVE TO CONVINCE PEOPLE MORE TO SHARE THEIR RIDES. WE NEED TO MORE FLEETS. WE NEED MORE VEHICLES AND WE NEED TO CONVINCE PEOPLE AND LEGISLATORS THAT THIS IS A RIDE SERVICE, BUT UNTIL 2025 THERE’S STILL SOME ROOM. >>YEAH. SO THAT 60% METRIC IS INTERESTING. THAT’S JUST IN HANOVER RIGHT NOW WHERE YOU ARE. AND THEN YOU’RE GOING TO HAMBURG. >>EXACTLY. >>IN 2019. ANY OTHER CITIES THAT YOU HAVE TARGETED?>>YEAH. OBVIOUSLY, WE ARE IN DISCUSSIONS WITH CITIES ALL OVER THE WORLD SO CURRENTLY THE NUMBERS IS ABOUT 50. BUT WE FIRST NEED TO BUILD THE WHOLE SYSTEM SO HANOVER WAS OUR FIRST START. BUT IN HAMBURG THE WHOLE THING GETS EVEN MORE COMPLEX BECAUSE THEN WE FIRST WILL USE THE FIRST TIME WE’LL USE THE NEW VEHICLE THAT SAYS — THAT IS BATTERY ELECTRIC. SO WE ARE CURRENTLY BUILDING UP THE CHARGING INFRASTRUCTURE. HIGH POWER CHARGING, BUILDING UP AND TRAINING ALL THE DRIVERS AND PREPARING EVERYTHING. SO WE WANT FIRST TO MAKE THE WHOLE SYSTEM ROBUST TO OPTIMIZE THE BUSINESS MODEL AND START SCALING. SO WE’RE PREPARING SCALING NOW, BUT I CANNOT UNFORTUNATELY WHICH CITY WILL BE THE NEXT BUT THERE ARE NEXT CITIES.>>I THINK THIS IS THE PERFECT PLACE TO TALK ABOUT THE NEXT CITY. >>I KNOW. NEXT YEAR. >>NEXT YEAR. SO LAUREN, YOU MENTIONED THAT YOU’RE ALSO LOOKING AT A PULLING MARKETS OFF TO ROAD. WHERE’S THE BEST PLACES TO DO THAT? IS IT GERMANY, HAMBURG AS WELL, OR IS THERE A PERFECT CITY TO ACHIEVE AS WELL?>>I THINK THEPERFECT CITY IS EUROPE AND NORTH AMERICA WHERE A LOT OF CARS ARE IN THE BIG CITIES. WE HAVE HUGE PROBLEMS WITH, YOU KNOW, A LOT OF CARS ON THE ROAD. THE SHARING MAKES SENSE, OBVIOUSLY. SO I THINK THERE IS NOW NO REALLY PERFECT SPOT IN THE WORLD WHERE YOU CAN SAY THIS IS THE SHARING CITY. FOR EXAMPLE, BERLIN IS A SHARING CITY BUT IT’S ALREADY THEY’RE ALL OVER THE PLACE, SHARING SERVICES. SO IT’S VERY HARD TO START HERE ACTUALLY. SO I THINK WE WILL START IN EUROPE. BECAUSE WITH EVERY CAR WE SELL AND WE PLAN TO SELL 260,000 CARS –>>60,000?>>260,000. WITH EVERY CAR WE PUT ON THE ROAD THERE’S ONE SHORT VEHICLE. SO WHAT OUR INTERESTING BUSINESS MODEL IS, THE CUSTOMER PAYS THE INVESTMENT. THEN HE USES THE SHARING SERVICES. WE HAVE ONE VEHICLE MORE ON THE ROAD, RIGHT? SO THIS FLEET IS GOING TO BE HUGE. WHAT WE PUT ON THE ROAD. IT’S GOING TO BE ALL OVER EUROPE.>>SO WHO IS YOUR CUSTOMER? THAT’S AN INTERESTING BUSNESS MODEL. YOU HAVE SOMEONE WHO IS BUYING THE VEHICLE. >>EXACTLY. >>THEN YOU’RE BUILDING THE PLATFORM. THEN THEY WOULD USE THAT AS A WAY TO MAKE MONEY. I WOULD — WHY WOULDN’T — WHY WOULDN’T THEY BE AN UBER DRIVER, FOR EXAMPLE?>>WELL, BECAUSE THEY EARN MONEY THERE. IMAGINE YOU HAVE A CAR GOING — TAKING THE CAR TO WORK AND BACK HOME. AND THE WHOLE DAY THE CAR STANDS OUTSIDE JUST STANDING THERE, DOING NOTHING, RIGHT? AS SOON AS YOU GET PAID FOR SHARING IT, YOU WOULD DO IT. PEOPLE, YOU KNOW, TEN YEARS AGO ASKED WHY WOULD SOMEONE RENT THEIR ROOM IF THEY’RE NOT ON VACATION? GUESS WHAT? AIRBNB IS THE BIGGEST HOTEL CHAIN IN THE WORLD. BECAUSE IT — YOU KNOW, AS SOON AS YOU GET PAID YOU WILL DO IT. THAT’S THE SAME WITH WHAT WE SEE HERE. EVERY CAR WE PUT ON THE ROAD WE HAVE ONE MORE LESS VEHICLE ON THE ROAD. >>SO I’M WONDERING WHO THE MOYA CUSTOMER IS AND YOU HAVE SOME DATA COMING BACK RIGHT NOW AND IF IT IS SIMILAR TO THE SONO MOTORS CUSTOMER IN ANY WAY. DO YOU SEE THE PEOPLE USING THE MOYA SERVICE POTENTIALLY ALSO OWNING AN INDIVIDUAL VEHICLE OR –>>OF COURSE. SURE. SO I THINK FIRST OF ALL, IT’S IMPORTANT TO NOTICE THAT NO ONE SINGLE SERVICE CAN SOLVE LIKE ALL THE PROBLEMS THEMSELVES. SO IT’S REALLY LIKE — IN ORDER TO PUSH FORWARD THIS SHARING MOVEMENT WHICH IS STILL IN THE VERY BEGINNING, THAT’S STILL A MARKET NEED, SO WE SEE THE INTEREST OF CITIES TO PUSH THAT FORWARD AND THEN TO BRING THAT TO THE STREETS. BUT THERE’S SO MANY DIFFERENT USE CASES AND WE TALK ABOUT THE ACCESSIBILITY. WE TALK ABOUT LIKE CERTAIN THINGS LIKE SHOPPING OR WHATEVER THAT NEEDS TO BE COVERED. SO THEREFORE, I DEFINITELY BELIEVE THAT THIS MARKET NEEDS A MIX OF CERTAIN DIFFERENT SERVICES LIKE OURS. BUT THAT COULD BE THE SAME CUSTOMERS. FOR CERTAIN LIKE EVENTS AND USE CASES, THEY WOULD POTENTIALLY PREFER TO TAKE A MOYA. FOR OTHERS THEY WOULD USE THEIR PERSONAL CAR OR A PERSONAL CAR THAT THEY CAN SHARE. SO THAT THERE’S A HUGE — BUT I CAN SEE FROM THE FIRST NUMBERS IT SOME FOUR MONTHS. IT’S NOT EMPIRICALLY RELEVANT BUT IT’S REALLY LIKE A VERY BROAD RANGE. NOT LIKE ONLY THE YOUNG TECH, AFFLUENT PEOPLE BUT REALLY VERY MUCH SPREAD OVER THE WHOLE SOCIETY. AND WE ALREADY SEE THAT WE COVER LOTS OF USE CASES ESPECIALLY IN — WITH REGARDS TO LEDGER TIME. SO EVEN LIKE BRINGING KIDS TO THE PIANO LESSON OR THOSE KIND OF THINGS. SO THAT’S OBVIOUSLY SOMETHING WE WANT TO UNDERSTAND AND WHAT WE NEED TO FIND OUT MORE. BUT THIS IS LIKE THE SEGMENT. >>SO I PRESUME THAT YOU WOULD TAKE THIS DATA THEN AND THEN USE IT TO INFORM WHAT YOUR NEXT VEHICLE — MAYBE IT WON’T BE A VAN. MAYBE IT WILL BE SOMETHING PERFECTLY SUITED FOR FAMILIES OR A DATE OUT AT NIGHT. IS THAT WHERE YOU PLAN ON USING THE DATA POINT?>>THAT’S WHAT WE DO, OBVIOUSLY. WE ARE USING THIS DATA. WE ARE ALSO SHARING THIS DATA WITH LIKE CITIES OR INTERESTED LIKE ENTITIES. SO ON. AND THE SECOND THING IS THAT WE PUT A LOT OF EMPHASIS ON COCREATION. SO THE FIRST VEHICLE THAT WE WOULD BRING TO THE STREETS NEXT YEAR THAT WAS DESIGNED TOGETHER WITH IS OUR CUSTOMERS SO WE INVITED, FOR EXAMPLE, 20 PEOPLE IN A PAPER BOX THAT SOMEHOW RESEMBLED LIKE A SEAT BOX OF A VEHICLE. SO WE SAID IF YOU WOULD SIT HERE, IS THAT OKAY? WHAT IS THE LEG ROOM, CAN YOU SEE THE SCREEN? SO WE USE THE COCREATION QUITE A LOT. WE DO THAT WITH CITIES, WITH PEOPLE, WITH CUSTOMERS AND THEN WE BRING THE DATA AND TOGETHER WE DEVELOP THE CONCEPTS TOGETHER WITH OUR FRIENDS IN THE GROUP. BECAUSE WE ARE THE PRODUCT OWNERS FOR RIDE SHARING VEHICLES IN THE FOCUS GROUP. SO THAT GOES BACK INTO THE PRODUCT DEVELOPMENT PROCESS OF FOLKS IN PASSENGER CARS OR WHATEVER. >>DID SONO MOTORS KIND OF TAKE A SIMILAR APPROACH WHERE IT SOUNDS LIKE YOU’RE REALLY TAPPING A NUMBER OF DIFFERENT, YOU KNOW, CITIES. MAYBE EVEN VOLKSWAGEN GROUP. WHICH IS YOUR PARENT COMPANY. WHAT ABOUT SONO MOTORS, WHAT DID YOU DO FOR THAT DESIGN PROCESS? DID YOU BRING IN A CROWDSOURCING ASPECT?>>WE HAD A VERY SIMILAR APPROACH THERE. BECAUSE WE WERE — WE HAVE A STRONG COMMUNITY BEHIND US ALREADY 9,000 PAID — DOWN PAYMENTS FOR A CAR, SO ON AND SO FORTH. BUT WHAT WE DID IS ACTUALLY GOING WITH A PROTOTYPE IN A VERY EARLY STAGE ON TEST DRIVE TOURS ALL OVER EUROPE. WHAT HAPPENS IS THAT WE GOT A LOT OF FEEDBACK FROM OUR CUSTOMERS AND QUICKLY CHANGED THAT IN OUR DEVELOPMENT PROCESS. SO THIS IS, YOU KNOW, NOT — NORMALLY YOU GO OUT THERE WITH A REALLY DEVELOPED CAR AND LAUNCH IT WITH A HUGE MARKETING BUDGET. BUT WE DID IT THE OPPOSITE WAY. AND WE DID LET THE COMMUNITY DESIGN THE SEATS, ABOUT COLOR OF THE CAR. ABOUT CHARGING INFRASTRUCTURE OF THE CAR. ABOUT A TRAILER HOOK AND SO FORTH. SO ON. SO WE ARE A VERY CLOSE COMMUNITY APPROACH THERE. I THINK IT’S QUITE THE SAME THERE. BUT THAT’S — I THINK THAT’S THE THING WE DO. >>SO EVEN IN SPITE OF DOING THAT PROCESS WHERE YOU’RE GETTING THE FEEDBACK, YOU’RE ABOUT TO DO SOMETHING VERY HARD WHICH IS BUILD A CAR. BUILDING CARS IS HARD. >>YEAH. >>AND YOU KNOW, AT THE SAME TIME, THERE ARE GIANTS OUT THERE — VOLKSWAGEN IS ONE OF THEM, WHICH I BELIEVE JUST SAID THAT THEY WERE GOING TO BOOK PRODUCTION FOR I THINK 15 MILLION EVs. SO HOW DO YOU COMPETE AGAINST A COMPANY LIKE VOLKSWAGEN AT ALL?>>WELL, WE HAVE A TOTALLY DIFFERENT APPROACH. WE CAN START FROM SCRATCH. WE CAN START FROM A WHITE PAPER. AND DON’T HAVE LEGACY IN THE BAG. YOU KNOW? WE COULD DESIGN THE CAR FROM A VERY — WE THINK REALLY THE CAR, WHAT WE DID, FOR EXAMPLE, PUTTING SOLAR PANELS ON A CAR WAS NEVER DONE BEFORE IN A MASS PRODUCED CAR. SO CHANGING PARADIGMS FOR, YOU KNOW, JUST RETHINKING THE WAY WE MOVE FROM “A” TO “B.” BECAUSE PEOPLE ARE ASKING YEAH, ELECTRIC MOBILITY, WHAT HAPPENS, WHAT’S DIFFERENT? I SEE THE SAME WAY LIKE THE GENERATIONS WHICH IS COMING IS JUST ONE — JUST GET FROM “A” TO “B” IN A FAST AND SUSTAINABLE WAY. THAT’S THE ONLY THING. AND FOR THAT, YOU NEED SOLUTIONS. AND I THINK THAT’S BASICALLY THE DIFFERENCE BETWEEN US AND OTHER OEMs. >>YOU SAID 260,000 VEHICLES YOU’RE PLANNING, BY WHAT TARGET DATE DO YOU WANT TO BE ABLE TO REACH THAT VOLUME?>>WELL, THE VOLUME IS THE LIFE CYCLE. THE VOLUME IS PER YEAR, 50,000 VEHICLES.>>YOU ALREADY HAVE A FACTORY AND –>>WE DON’T HAVE OUR OWN FACTORY. THAT’S ONE — THAT’S ONE DIFFERENT STRATEGY. WE LET PRODUCE HERE IN EUROPE. DON’T HAVE A KNOWN FACTORY. DON’T HAVE STAMPING TOOLS BECAUSE OF THE SOLAR CELLS. USE CARRYOVER PARTS. JUST HAVE ONE VERY — DON’T HAVE A PAINT SHOP. ALL THOSE STRATEGIES IS, YOU KNOW, TO SAVE MONEY. TO SAVE INVESTMENT AND BE QUICKLY IN THE MARKET WITH THE LOW RISK. >>SO I KIND OF HAVE A SIMILAR QUESTION FOR YOU, EXCEPT FOR THAT VOLKSWAGEN IS PART — MOYA’S PART OF VOLKSWAGEN A LITTLE BIT. BUT WHAT IS THAT RELATIONSHIP LIKE? I MEAN, DO YOU FEEL LIKE YOU’RE COMPETING AGAINST THE BUSINESS MODEL OF VW AND WHAT IS THAT? IS THERE TENSION THERE?>>NO, THERE’S ABSOLUTELY NO TENSION BECAUSE IT’S FULLY UNDERSTOOD THAT TWO EFFECTS. WE SEE LIKE WITH ALL THE TRENDS THAT WE ARE — LIKE THE ORGANIZATION AND SO ON, AND ALL THESE CHALLENGES THAT CITIES ARE FACING IN THE WORLD, THERE IS A NEED FOR A NEW MOBILITY CONCEPT. THE DEMAND FOR MONTH IS RISING AND IN EMERGING COUNTRIES AND COUNTRIES LIKE GERMANY AND SO ON. THERE’S A NEED FOR NEW SOLUTIONS. SO THAT’S THE FIRST THING. SO YOU CAN LIKE THAT OR YOU CAN HATE IT. BUT IT’S THERE. SO VOLKSWAGEN WANTS TO PLAY A ROLE HERE, BECAUSE IT’S NOT ONLY A THREAT THAT CAR OWNERSHIP IS ABOUT TO BE DECREASED IN CITIES, I BELIEVE THAT — IT’S GOING TO LOOK DIFFERENT IN RURAL AND SUBURBAN AREAS. BUT IT’S ALSO A BIG MARKET OPPORTUNITY. IT’S REALLY A HUGE MARKET AND WE WANT TO TAP INTO THAT MARKET POTENTIAL. AND IT’S ALSO FOR A — SO INTERESTING FROM A BUSINESS MODEL STANDPOINT IF YOU SEE A NORMAL LIKE VEHICLE BUSINESS IT’S A ONE-TIME SALE. THEN YOU HAVE A LITTLE MAINTENANCE AND THINGS AFTERWARDS OUR VEHICLES CREATE REVENUE AND MARGIN EVERY DAY THAT THEY’RE WORKING. THEY’RE MUCH HIGHER UTILIZED SO THE FE CYCLE IS SHORTER. THAT MEANS YOU NEED TO RENEW THE CARS MORE OFTEN AND THERE ARE TOTALLY NEW THINGS AND WE’LL EARN MONEY IN THE FUTURE. FOR EXAMPLE, REFURBISHMENT. LIKE IN THE AIRLINE INDUSTRY. YOU WILL POTENTIALLY BE ASKED TO REFURBISH THE INTERIOR AFTER TWO YEARS BECAUSE IT’S RUNDOWN OR YOU WANT TO IMPLEMENT NEW FEATURES. YOUR COMPONENTS, SO ON. SO THERE’S NO — SO IT’S A VERY STRONG — IT SHOULD BE LIKE A NEW FUTURE PILLAR OF THE GROUP. >>SO JUST TO WRAP UP HERE, I’M WONDERING IF YOU SEE A SPACE — WHERE GEOGRAPHICALLY DO YOU SEE MOYA OR SONO WORKING? DO YOU SEE IT IN EUROPE, OR WANTING TO GO INTO THE UNITED STATES OR AFRICA?>>SO WE ARE GLOBAL COMPANIES SO THE CITIES WE ARE TALKING ABOUT ARE ALSO IN THE U.S. AND IN ASIA. AND I THINK IT’S ALSO INTERESTING TO SEE WHERE LEGISLATION IS REALLY SUPPORTIVE TO SHOW CASE THEM AND CREATE A DOMINO EFFECT AND THIS IS ESPECIALLY TRUE WHEN WE TALK ABOUT AUTONOMOUS DRIVING WHERE POTENTIALLY CERTAIN REGIONS ARE A LITTLE BIT MORE ADVANCED OR PROGRESSIVE, SO ON. SO OUR VISION IS GLOBAL. >>THE SAME HERE. BASICALLY, IT’S THE SOLAR CAR. I DON’T HAVE TO TELL WHAT THAT MEANS. I THINK THERE ARE SOME COUNTRIES WHERE THE SUN IS SHINING QUITE A LOT. BUT I THINK THOSE CITY PROBLEMS WITH A LOT OF CARS ARE NOT ONLY IN EUROPE AND THEY’RE NOT ONLY IN NORTH AMERICA. THEY’RE ALSO IN SOUTH AMERICA. IN AFRICA, IN ASIA. SO, YEAH, WE LOOK AT LIKE — WE LOOK AT THOSE COUNTRIES.>>ALL RIGHT. WE’LL LOOK OUT FOR IT IN SUNNIER CLIMATES. THANK YOU SO MUCH FOR COMING. >>THANK YOU.>>THANKS. >>HAVE A GOOD ONE. ♪ ♪♪>>>HELLO, FRIENDS. WHAT’S UP? SO I HAVE GOT A FRIENDLY REMINDER. THERE’S A LIVELY DISCUSSION HAPPENING. I’M ALWAYS AFRAID MY FLY IS DOWN EVERY TIME. THERE’S A LIVELY DISCUSSION HAPPENING ON SOCIAL MEDIA. THE BEST WAY TO PARTICIPATE IN THAT IS GO TO TWITTER.COM AND SEARCH FOR JORDAN ARBROOK — NO SERIOUSLY? SOME OF MY BEST STUFF. ALL RIGHT. WE’LL TALK ABOUT SPACE NOW. PLEASE WELCOME TO THE STAGE FROM PROMISE VENTURES MIKE COLET. FROM ISEE, FROM THE EUROPEAN SPACE AGENCY FRANK, AS WELL AS YOUR MODERATOR, FREDERIQUE.>>ALL RIGHT. ACCORDING TO A MONITOR WE HAVE ONLY 20 MINUTES BUT I THINK WE HAVE HALF AN HOUR, SO WE’LL JUST IGNORE THAT ONE. SPACE. FINAL FRONTIER. YET, HERE WE ARE. YOU WERE HOPING TO — YOU HAVE ONE SATELLITE IN SPACE RIGHT NOW.>>YES. >>YOU WERE HOPING TO HAVE THE SECOND ONE UP TODAY — WELL, ACTUALLY, A FEW DAYS AGO. FALCON 9 NEVER TOOK OFF.>>THAT IS CORRECT. SO WE’RE ISEE. WE BUILD THE SATELLITES AND WE HAVE ONE OF OF THOSE FLYING THAT WE LAUNCHED IN JANUARY OF 2018. IT WAS A HUGE MILESTONE FOR OUR COMPANY. AND, YEAH, WE WERE HOPING TO HAVE ANOTHER ONE UP BY NOW. I WISH I COULD SAY SOMETHING MORE, BUT IT’S NOT THERE YET. AND THAT’S PROBABLY AN EXCELLENT WAY TO START THIS PANEL THAT’S WHAT SPACE IS ALL ABOUT, ACTUALLY. YOU HAVE TO GET USED TO DELAYS IF YOU WANT TO BE PART OF IT. >>ARE YOU A PATIENT PERSON?>>I’M SORRY?>>ARE YOU VERY PATIENT?>>I HAVE LEARNED HOW TO BE. I DON’T THINK I WAS THIS PATIENT WHEN I WAS STARTING THIS BUSINESS BUT ALL THE ROCKETS SO FAR THAT WE HAVE HAD WERE DELAYED. WE HAVE ACTUALLY HAD TO COME UP WITH NEW WAYS OF NAMING THE SATELLITES BECAUSE AT FIRST WE WOULD TIE THEM UP TO LAUNCHES AND THEN THE ONE WAS AFTER THREE, AND THE SECOND WAS AFTER FOUR, SO ON. SO WE HAVE STOPPED NAMING THEM IN THE SEQUENTIAL NUMBERS BECAUSE IT DIDN’T MAKE ANY SENSE. >>NEVER KNOW WHERE THEY’LL GO. RACHEL, YOU ACTUALLY ARE BUILDING SATELLITES. YOU’RE BASICALLY LEGO BLOCKS FOR SATELLITES. ANY OF YOUR SATELLITES WAITING TO TAKE OFF THERE ON THAT ROCKET?>>ACTUALLY, LATELY, WE HAVE QUITE A FEW CUSTOMERS SO MORE THAN 40 COMPANIES AROUND THE PLANET USING SATELLITE TECHNOLOGIES THAT WE HAVE BUILT FOR THEM. SO IT’S QUITE PROBABLE THAT THERE ARE QUITE A FEW OF THE SATELLITE SYSTEMS ON BOARD. >>BUT YOU DON’T ACTUALLY KNOW, DO YOU?>>WE DON’T EVER KEEP TRACK SO PATIENTLY ABOUT OUR CUSTOMERS BECAUSE IT’S MORE THAN 40 NOW. IT’S KIND OF TRICKY, BUT IN GENERAL, WE STARTED WITH THE IDEA THAT WE EXIST TO PUT THE SATELLITES IN OPERATION AND NOW THREE YEARS AFTER WE GOT FOUNDED, LOCALLY, THAT THERE ARE SO MANY COMPANIES USING OUR TECHNOLOGY FOR THE BENEFIT OF THEIR OWN BUSINESS. >>YES. FRANK, EUROPEAN SPACE AGENCY, I ASSUME YOU PUSH A LOT OF PAPER AROUND OR WHAT DO YOU DO?>>YEAH, PEOPLE BELIEVE WE ARE THE BIG, SLOW GIANT AND SOMETIMES IT’S NECESSARY WHEN YOU BUILD SOMETHING LIKE GALILEO, BUT I HAVE THE PRIVILEGE OF HEADING THE ALIEN OFFICE. THE SUBMARINE WHICH PUSHES OUR ORGANIZATION. WE DO THAT BY TECH TRANSFER AND BY SUPPORTING A ROUGHLY 160 SET-UPS THIS YEAR. YOU HAVE TO BRING YOUR OWN INNOVATION FROM THE INSIDE IN AND PUSHING. OTHERWISE, NOTHING IS MOVING.>>SO YOU’RE THE AREA 51 OF YOUR THE EUROPEAN SPACE AGENCY, YOU’RE SAYING?>>YEAH. NOT AREA 51, BUT REALLY THE — [ INDISCERNIBLE ]. THE NORMAL WAY OF PROCUREMENT. WHEN YOU HAVE CRAZY IDEAS, FRANK, IF YOU STOP PUSHING THE AGENCIES, THE AGENCY STOPS MOVING SO WE TRY TO PUSH WHEREVER WE CAN. AND WE’RE PUSHING GREAT ENTREPRENEURS AND GREAT BUSINESS CASES.>>MIKE, THAT’S YOUR CASE AS PUSHING THE INVESTOR — YOU’RE AN INVESTOR IN ISIGH. >>YEAH, WE ARE PRIVILEGED TO INVEST IN TEAMS THAT WE FEEL ARE EXTRAORDINARY AND DOING INTERESTING THINGS THAT ARE DIFFERENT. WE WERE ABLE TO MAKE OUR FIRST SPACE INVESTMENT IN A COMPANY CALLED SPIRE ABOUT FIVE OR SIX YEARS AGO WHICH REALLY TAUGHT US A LOT ABOUT SPACE. AND WE REALLY WANTED TO INVEST AIL THE WAY UP AND DOWN THE SUPPLY CHAIN. SO WE ARE FORTUNATE ENOUGH TO INVEST IN ANOTHER SEVEN DIFFERENT COMPANIES. ANOTHER CONSTELLATION COMPANY ISIGH WHERE — WE’RE IN ROCK LAB. AS WELL AS A HOST OF OTHER APPLICATION LAYER COMPANIES THAT ARE USING GEOSPATIAL DATA. COMPUTER VISION TO GO INTO DIFFERENT, MATURE INDUSTRIES THAT TRADITIONALLY DON’T GET DATA. IF THAT’S AGRICULTURE, INSURANCE, BUT FOR US IT’S ALL ABOUT FINDING PROPRIETARY DATA IN A WAY THAT TRADITIONALLY YOU CAN’T FIND. AND IF THAT TAKES US TO SPACE, THEN WE’RE ABLE TO INVEST IN THESE TEAMS THAT ARE GROWING THINGS TO REALLY BE ABLE TO DELIVER THINGS TO — FROM THE EARTH TO THE TERRESTRIAL SIDE THAT’S NEVER BEEN DONE. >>WHAT’S DIFFERENT IN INVESTING IN THE SPACE START-UPS VERSUS THE OTHER START-UPS YOU INVEST IN?>>I THINK THERE’S A BIG FALLACY OUT THERE THAT SILICON VALLEY OR OTHERS SEE SPACE AS SOME INSANELY HUMAN CAPITAL INTENSIVE, MASSIVELY FAR DURATION RISK INVESTMENT THAT JUST EATS UP HARDWARE, CAPITAL, NEVER PRODUCES REVENUE. BUT THE LEVERAGE, ALTHOUGH IT’S PROBABLY TRUE ON THE FRONT SIDE THE LEVERAGE IS EXTRAORDINARY ONCE THE SATELLITES AND SATS ARE UP. AND YOU JUST TRADITIONALLY DON’T NEED MASSIVE AMOUNTS OF SALESFORCE WHERE IF YOU’RE PUTTING IN MILLIONS OF DOLLARS IN, YOU NEED THAT AMOUNT — [ INDISCERNIBLE ]. ON THE SALES SIDE. YOU DON’T NEED THAT IF YOU HAVE A — A CONSTELLATION OR DOING OTHER THINGS. SO IT TAKES A LITTLE BIT MORE — WE FIND THE AMOUNT OF CAPITAL EVEN TODAY BECAUSE THINGS ARE GETTING MUCH CHEAPER WITH THE FLY WHEEL IDEA AND SPACE AS A SERVICE WHICH CHANGED THE INDUSTRY AROUND HOW THE FOUNDERS ARE COMING AT IT. THAT’S OKAY WITH IT. IT’S LIKE MORE FOR US. WE’RE HAPPY BUT I DO THINK YOU’RE GOING TO SEE A DRASTIC CHANGE IN THE START-UPS. >>SO YOU HAVE WORKED WITH SEVERAL START-UPS?>>YEAH. ROUGHLY 700 AT THE MOMENT. MORE TO COME.>>THAT’S A LOT OF START-UPS IN THE SPACE BUSINESS. >>AND YOU HAVE TO SEE IT AS — IT’S NOT ONLY GOING IN — IT DOESN’T GO IN THE DOWNSTREAM. IT’S ABOUT NAVIGATION, EARTH OBSERVATION. WE HAVE ABOUT 14 TERABYTE OF DATA EVERY DAY. SO IT GOES FROM HUMAN SPACE, TO ROCKETS, TO DATA, TO HEALTH CARE. IT HAS TO BE A SPACE RELATION. IT’S NOT ALWAYS THE ROCKET — IT’S GREAT. BUT I THINK WE HAVE NOT ANY CRAZY AREA WHERE WE DON’T HAVE A START-UP. >>LET ME ASK THE FOUNDERS HERE, WHAT MADS YOU WANT TO DO A SPACE START-UP?>>OF COURSE THAT’S AN INTERESTING QUESTION. I WANTED TO FOLLOW-UP ON WHAT MIKE WAS SAYING. YOU KNOW, WHEN WE WERE RAISING THE FIRST ROUND OF CAPITAL BACK IN 2015, EARLY 2015, WE DISCOVERED THE INTERESTING DYNAMIC. EVERY TIME WE SAID, WE’RE A SPACE START-UP, THEY SAID THAT’S NOT MY BUSINESS, IT’S VERY, VERY DIFFICULT TO INVEST IN IT. AND THEN WE SAID WE WERE A DATA START-UP BECAUSE THAT’S ULTIMATELY WHAT WE ARE. WE USE SENSORS THAT FLY IN THE LOWER ORBIT, BUT ULTIMATELY WHAT DO WE COLLECT IS DATA AND WHAT DO WE SELL IS COMPETITION. WE ACTUALLY MANAGE TO CLOSE IT FASTER AND WE TELL OUR INVESTORS WE ARE USING SATELLITES. BUT THE WHOLE STARTING IDEA, THE FIRST FEW SECONDS, WHEN YOU APPROACH SOMEONE, WHAT DO YOU DO? WE ARE ACTUALLY INTO BIG DATA AND INFORMATION SERVICES AND IT WAS A COMPLETELY DIFFERENT STARTING POINT THAN SAYING WE’RE BUILDING OUR OPEN SATELLITES. THE SATELLITES WERE LIKE THE CHERRY ON TOP OF THE CAKE, BUT IT WAS THE –>>YOU DIDN’T SAY AI AND MACHINE LEARNING TOO. I HEAR YOU HAVE MONEY FOR THAT THESE DAYS. >>SO THERE USED TO BE A MOMENT WHERE THAT WAS THE CASE, I GUESS. WE TRY TO — WE TRY TO BE A LITTLE BIT MORE SPECIFIC THAN THAT. IF ONE CAN BE. WE OF COURSE DO USE AI AND MACHINE LEARNING. EVERYONE DOES IN ONE WAY OR THE OTHER. BUT I GUESS WHAT’S INTERESTING ABOUT ISIGH PARTICULARLY IS THE INFORMATION SERVICES THAT WE ARE GOING AFTER. THEY’RE EXTREMELY NICHE PRODUCTS. GO BACK TO THE BEGINNINGS WHEN IT WAS CREATED, ISIGH, FROM THE BEGINNING WE WERE FOCUSED ON EXTREMELY SPECIFIC APPLICATIONS. SO PARTICULARLY ISIGH CAME FROM THE IDEA OF MONITORING ICE CONDITIONS WITHIN THE ARCTIC TERRITORY IN ORDER TO ENABLE SHIPPING THROUGH THE NORTHERN SHIPPING ROUTES. WE HAD THE ROUTES, THE VESSELS, WE KNEW ALL THE COMPANIES SO OUR BUSINESS MODEL — THE WAY WE HAVE STRUCTURED OUR BUSINESS MODEL IN THE EARLY STAGE WAS PROBABLY SOMETHING THAT SILICON VALLEY HAS DONE IN THE EARLY DAYS. WE WERE NOT STARTING WITH A PLATFORM. WE WERE STARTING WITH A NICHE APPLICATION WHERE THE SENSOR WAS A WAY TO GET OUR DATA. BUT ULTIMATELY THE BUSINESS MODEL WAS AROUND THE APPLICATION. >>INTERESTING. RACHEL, FOR YOU, YOU’RE LOWER ON THE STACK THERE. >>YEAH. >>YOU’RE BUILDING THOSE SATELLITES.>>YEAH. ACTUALLY –>>WHY?>>YEAH, I ASK THAT MYSELF A LOT OF TIMES, YOU KNOW? HAVING A SPACE — IT’S LIKE BEING A BABY AGAIN. YOU WAKE UP AT 4:00 A.M. AND YOU CRY.>>YOU’RE IN BULGARIA. >>WE’RE IN BULGARIA AND IT WAS — THEY DON’T CALL SECURITY IMMEDIATELY AFTER I TELL THEM WHAT I WANT TO DO. BUT IN GENERAL, MORE SERIOUS, OUR COMPANY EXISTS WITH THE SOLE GOAL SO THAT WE CAN PERMIT EVERYONE — I MEAN EVERYONE TO GET EASY ACCESS TO SATELLITE’S DATA. SO WE STARTED WITH A SIMPLE STEP, LET’S DO A COMMODITY PRODUCT. THE WAY YOU USE YOUR SMARTPHONE, YOU NEVER CARE ABOUT THE INTERNAL PARTS BUT WHAT YOU CARE ABOUT IS THE USE OF THE SMARTPHONE. SO THIS COMPLETELY ORIGINAL IDEA, WE IMPLEMENTED IT INTO THE DESIGN OF THE SATELLITES, WITH THE TECHNOLOGY AND WE’RE HAPPY NOW THAT LOTS OF SPACE AGENCIES ARE LEVERAGING THIS PLUG AND PLAY — REALLY PLUG AND PLAY DESIGN WE DID WITH IT. IN GENERAL, LAUNCHING A SATELLITE SERVICE. WHICH MEANS THAT WE OPERATE THE LAUNCH AND DESIGN THE SPACECRAFT SO WHAT YOU GET IS DATA. BUT MOST FASCINATINGLY THE END OF NEXT YEAR WE ARE ANNOUNCING A SPACE TOUR. REALLY CREATING THE MOBILE-LIKE APPS. AROUND THEM ON BOARD OUR OWN SPACECRAFT IN ORBIT, WHICH PERMITS THE END USER ON THE GROUND TO HAVE THE INTERACTION WITH THE SPACECRAFT.>>[ INDISCERNIBLE ]. >>I THINK WE NEED BOTH — YOU NEED TO OPERATE SATELLITE AND SPACECRAFT TECHNOLOGY ROBUSTLY AND RELIABLY. BUT NEED TO MAKE IT SO MUCH MORE AFFORDABLE SO THAT MANY MORE PEOPLE COULD JOIN THE CONVERSATION AND THE WORKING SPACE. AT THE SAME TIME, SIMPLIFYING IT TOWARDS THE DATA. WE CHOSE — IT’S COMPLETELY THE FUTURE BECAUSE AT THE END OF THE DAY WE’RE USING LOTS OF DATA AND USING INFORMATION FROM THE DATA.>>YOU BUILD YOUR OWN SATELLITES, DON’T YOU?>>YEAH, I MEAN WE CAN SPEND SOME TIME OVER HOW WE BUILD THE SATELLITES BUT IT’S A LARGE SATELLITE ALREADY. IT WEIGHS AROUND 85 KILOGRAMS AND PROBABLY THE SIZE OF YOUR REFRIGERATOR. WE BUILD THE MAJORITY OF THE ITEMS. WE DO PURCHASE SOME OF THE SUBSYSTEMS. WE ARE ACTUALLY IN THE BACK YOU WERE TALKING WITH RACHEL, WE’RE PRODUCING AND WE’RE BUILDING SOMETHING THAT WE COULD USE. THERE SEEMS TO BE A MASSIVE AMOUNT OF TERRITORY. SO WE BUY CERTAIN PIECES. IT DOESN’T MAKE SENSE TO BUILD EVERYTHING, ACTUALLY. THERE ARE SO MANY ITEMS THAT ARE USED BY A VARIETY OF SATELLITES, FOR INSTANCE, WE HAVE IN PARTICULAR TALKED ABOUT THE COMMUNICATION RADIO. EVERY SATELLITE HAS TO COMMUNICATE WITH THE GROUND. THERE’S MORE OR LESS STANDARD PROTOCOL THAT YOU’RE USING. THERE’S A SUBSTANDARD THAT YOU’RE USING. IF YOU APPLY THE VOLUME GAME TO IT, NO WAY YOU CAN BUILD IN A LOWER COST FASHION. BUT THEN THERE ARE SYSTEMS THAT ARE CREATING THE KEY TECHNICAL ADVANTAGE THAT OUR COMPANY POSSESSES. IT’S THE OPERATOR SENSOR AND IF WE BELIEVE THAT ISIGH HAS TO HAVE THE FLEXIBILITY, THE ABILITY TO ADOPT THE SENSOR DEPENDING ON THE MARKET NEEDS THEN WE HAVE TO HAVE THE CAPABILITY TO MAKE THOSE CYCLES INTERNALLY. WE HAVE TO HAVE THE TEAM THAT’S CAPABLE OF TURNING IT AROUND FROM WHATEVER ONE DESIGN TO A SECOND DESIGN. YOU CAN OBSERVE IT QUITE WELL WITH THE X-1 AND X-2. IT’S A COMPLETELY NEW SENSOR. WE HAVE LAUNCHED THE FIRST SATELLITE, WE HAVE TALKED TO THE CUSTOMERS, AND THEY GAVE US FEEDBACK. THE NEXT THING THAT’S COMING UP IS JUST A FEW MINUTES APART. WITHIN TEN MONTHS WE TURN IT AROUND. BECAUSE WE HAVE THAT INTERNAL CAPABILITY AND WE ARE LAUNCHING SOMETHING MUCH CLOSER TO WHAT THE CUSTOMERS NEED. >>I THINK WHAT’S INTERESTING IS YOU HAVE TWO DIFFERENT WAYS OF GOING ABOUT IT. YOU HAVE A FULL STACK, FULLY INTEGRATED COMPANY OF ANOTHER COMPANY THAT’S DOING IT FOR OTHERS AND THAT’S WHAT’S REALLY CHANGED OVER THE LAST THREE OR FOUR YEARS WITHIN THIS NEW SPACE ARENA. YOU KNOW, FIVE YEARS AGO IT’S — AT SPIRE WE WERE TRYING TO WORK WITH DIFFERENT SUPPLIERS TO GET DIFFERENT ANTENNAS INTO CERTAIN WAYS AND WE REALIZE WE HAD TO BUILD THE WHOLE THING. BUT THIS IDEA OF THE DEMOCRATIZATION OF SPACE IS REALLY TRUE. YOU’RE FINDING THE ABILITY NOW FOR COMPANIES TO START, TO USE OTHER PEOPLE TO POSSIBLY BUILD THOSE, TO EVEN HOST DIFFERENT SENSORS. ASB, AND GPS FOR WEATHER AND A PROGRAM FOR OTHERS TO HOST. SO I HAVE NEVER SEEN THE INDUSTRY NOW BE ABLE TO BE ABLE TO PICK AND CHOOSE AND TO GET — AND WITH LAUNCH, GETTING MUCH BETTER. AN ABILITY TO DO THINGS MUCH CHEAPER AND FASTER. >>FRANK?>>IN PRINCIPLE, WE HAVE COMPANIES BUILDING NEW LAUNCHERS. PRIVATE COMPANIES. WE HAVE COMPANIES BUILDING CONSTELLATIONS. COMPANIES MOVING ALREADY ON SERVICES. AND THE GOOD NEWS IS FOR ALL OF YOU HERE, YOU DON’T NEED YOUR INTO SATELLITE BECAUSE WE HAVE CHALLENGES AND WE HAVE COLLEAGUES THAT ARE DOING THAT ALREADY. SO TODAY YOU GO ONLINE AND YOU DOWNLOAD OR EVEN PROGRAM IT. YOU’RE USING THE DATA AND SPACE IS BECOMING JUST A COMMODITY. NAVIGATION, EARTH OBSERVATION, TELECOMMUNICATION AND SPACE WILL BE THE BACKBONE OF THE DIGITAL ECONOMY. IT’S JUST LIKE A FIBER, IT’S A SERVICE. AND COMPANIES HAVE LINKED TO THE SERVICES BUT REALLY THE BIG LEVERAGES WERE USING THE SERVICES, THESE DATAS, THESE SENSORS AND THESE CAPABILITIES. MAYBE THEN THE SEXIEST PART WHICH I SEE THEN IS WHAT WE DO THEN ON MARS. WHO IS BUILDING THE FUEL STATION ON MARS. WHO BUILDS THE HOTEL ON MARS OR THE POWER PRODUCTION AND HOW YOU CAN MAYBE PAY FOR IT OR FINANCE IT. >>YOU HAVE SEEN SO MANY SPACE START-UPS. WHAT’S THE CRAZIEST THING YOU HAVE SEEN?>>I THINK I MENTIONED IT ALREADY. HOW TO BUILD UP THE FUEL STATION ON THE MOON ORBIT AND WHAT IS THE CURRENCY OR CRYPTOCURRENCY, HOW TO PAY FOR IT.>>YOU SAID CRYPTOCURRENCY –>>YOU WANT TO PRODUCE ON THE ASTEROID AND THE OTHER PROJECT IS HOW YOU TAKE SMALL BOTS, HAMMER IT INTO THE ASTEROID AND MAKE OUT OF FIVE GENERATION, LIVE GENERATION, BUILDING OUT OF THAT SOIL A SPACE SHIP OUT OF IT. SO MORE GRAPHIC ENGINEERING SO THAT’S REALLY FAR AWAY. WHAT THE GENTLEMEN ARE DOING TODAY IS TODAY. YOU HAVE TO GRAB IT. >>YOU TALKED ABOUT CRYPTOCURRENCY AND VULCANIZING. YOU’RE A GOVERNMENT AGENT, SO WHAT IS IT LIKE TALKING ABOUT THOSE THINGS?>>WHICH MEETINGS? THE GOVERNMENT MEETINGS. THE TECHCRUNCH. >>NOT THESE PEOPLE, THEY KNOW. >>BUT YOU HAVE TO HELP US. YOU KNOW? YOU HAVE TO PUSH THE SPACE AGE INTO THE NEXT LEVEL. AND YOU HAVE TO HELP THE BIG CORPORATES. YOU HAVE TO HELP THE AGENCY. I THINK YOU HAVE THE IDEAS. I HAVE LEARNED THERE’S NO CRAZY IDEA. THERE’S NO CRAZY CUSTOMER. SO THEREFORE, THERE’S NO CRAZY –>>DO YOU CARE ABOUT THE EUROPEAN SPACE AGENCY?>>I CAN GO –>>YES. ACTUALLY, WE ALREADY WORK SUCCESSFULLY AN A COMMERCIAL BASIS WITH THE SPACE AGENCY AS WELL. NOT ONLY WITH THE EUROPEAN SPACE AGENCY, BUT A FEW OTHERS ON THE PLANET. BUT THE IDEA OF — BACK TO THE IDEA THAT WE JUST — FOR EXAMPLE, IN THE CRYPTOCURRENCY. SO LATELY YOU’LL BE SURPRISED HOW MANY ORGANIZATIONS THAT ARE APPROACHING US, ASKING FOR THE SOLUTIONS AND ASKING FOR THE TRANSACTIONS AND OTHER –>>WHAT ARE –>>ACTUALLY, A FEW OF THEM ARE FASCINATING IDEAS. THIS IS WHERE IT COMES FROM. TODAY, WE — I THINK WE’RE QUITE — WE’RE ON THE PLANET DELIVERING SATELLITES WITHIN FIVE DAYS’ TIME. IT’S LIKE AN AMAZON TYPE OF SERVICE. WE WANTED TO FOCUS ON THE CRAZY IN A GOOD SENSE NEW IDEA. AND THIS IS WHERE I THINK — HOPEFULLY WE’RE OPENING UP TO ALL SERVICES AND BUSINESSES EASY ACCESS TO THE TECHNOLOGY. MAKING SATELLITE TECHNOLOGY REALLY SIMPLISTIC. AND SEAMLESSLY WORKING WITHOUT YOU HAVING A GROUP OF ENGINEERS TO UNDERSTAND IT. THIS IS GOING TO DRIVE THE NEXT GENERATION OF ENTREPRENEURS TO TAP INTO THE SPACE MARKET DIRECTLY AND HAVING CRAZY GOOD IDEAS COMMERCIALIZED SUCCESSFULLY ON THE MARKET, MAKING PROFITS FOR THEM AND THE INVESTORS IN THE SHORT TERM, INSTEAD OF WORRYING ABOUT THE WHOLE INFRASTRUCTURE AND HOW TO BUILD IT.>>YEAH, SO I GUESS RACHEL HAD TO BE CAREFUL WITH HIS ANSWER. HE’S WITHIN — I’VE GOT MIKE IN BETWEEN, SO I CAN GO A STEP FURTHER. WE DEFINITELY DO CARE. IS THE SPACE AGENCY — I MEAN, I ALWAYS TRY TO READ BETWEEN THE LINES OF IT. IS THE SPACE AGENCY READY TO SUPPORT SMALL SPACE AND WORK ALONG WITH THE NEW GENERATION OF START-UPS? I MEAN, IT’S GETTING THERE. THERE’S DEFINITELY A LOT OF WORK TO BE DONE. BUT WE LOST THE — I MEAN, A LOT OF PEOPLE THAT STARTED START-UPS WANT TO GO BACK THERE AT A CERTAIN POINT. I MEAN, THERE’S NATURAL COMPLIMENTARY, NO START-UPS ARE DOING SCIENTIFIC MISSIONS BECAUSE THERE IS JUST NO BUSINESS OVER THERE. AND ISIGH WORKS PERFECTLY FOR THAT. RIGHT NOW THE QUESTION AHEAD OF THE SMALL START-UPS IS HOW ARE WE GOING TO SHAPE BOTH TYPES OF ORGANIZATIONS? SO THAT FOR THE EUROPEAN MARKET, THEY WORK IN THE MOST EFFICIENT MANNER. >>SURE. BECAUSE AS A VC, I WOULD THINK YOU’D LIKE TO WORK IN A SOMEWHAT LESS REGULATED SPACE.>>YEAH. WELL FROM A GOVERNMENT SECTOR, YOU KNOW, TRADITIONALLY THE VCs DON’T LIKE THE GOVERNMENT SECTOR BECAUSE IT TAKES A LOT OF TIME TO GET THINGS DONE. IF YOU LOOK AT THE MULTIPLES FOR DEFENSE CONTRACTORS. GOVERNMENTS ARE LOW, SO GENERALLY VC-1 IS GENERAL. IT’S IMPORTANT IN SPACE AND I THINK MAYBE ONE OF THE DIFFERENT THINGS THAT WE SEE IS WE — YOU KNOW, WE GO AROUND THE WORLD AND TALKING TO DIFFERENT SPACE AGENCIES, YOU KNOW, IN AUSTRALIA, UAE, ALL ARE DOING FASCINATING THING. SOME ARE MOVING ALONG DIFFERENTLY BUT IT’S VERY IMPORTANT — AN IMPORTANT SOURCE OF REVENUES AND GRANTS IN THE EARLY STAGE. AS A LOT OF NEW DATA STREAMS ARE COMING FORTH TO CORPORATES, THEY ARE SLOWLY UNDERSTANDING WHAT THIS ACTUALLY MEANS SO THERE COULD BE A LITTLE LATER ADOPTER IF YOU’RE DOING SOMETHING, YOU KNOW, VERY DIFFERENT. SO EVEN THOUGH THAT’S AN AREA WE TRADITIONALLY WOULD NOT LIKE TO SEE A LARGE PORTION OF THE REVENUE, WITHIN NEW SPACE IT’S A VERY IMPORTANT PIECE AND SO, YOU KNOW, GUYS LIKE FRANK, YOU KNOW, WE WORK A LOT WITH THEM AND LIKE WORKING WITH THEM. AND MAYBE THEY ARE A LITTLE TOO SLOW AT TIMES. BUT THEY SERVE A VERY IMPORTANT FUNCTION WITHIN THE MARKET NOW. >>CAN YOU SPEED UP?>>YEAH. I THINK — YES, AND OUR JOB IS TO HELP TO DERISK IN THE EARLY, EARLY STAGE. THIS IS THE COMPANY — THERE ARE TWO OR THREE PEOPLE AND THIS IS WHERE WE GIVE THEM THE CHANCE TO GROW. WE CHIP IN MONEY. WE ARE THE NICE UNCLE WHICH IS NOT TAKING EQUITY. WE OPEN OUR ADDRESS BOOK AND WE CHIP IN MONEY. THE IRISH HAVE A NICE SAYING, ON THE SHOULDERS OF THE GIANTS YOU SEE — [ INDISCERNIBLE ]. WE DON’T TAKE EQUITY BECAUSE THAT’S NOT OUR JOB THAT’S THE JOB OF THE VC COMMUNITY. WE HAVE TO HELP THEM GROWING. THEY’RE LIKE PARENTS, IF THEY GROW AND WE HAVE DONE A GOOD JOB, WE GET A POSTCARD AT CHRISTMAS THAT SAYS, HOW ARE YOU? WE LIKE TO OPEN THE DOORS AND I THINK WE TEND TO DO MORE. MY PROGRAM IS HOMEOPATHIC — I BELIEVE IN HOMEOPATHIC TREATMENT. >>WE CAN ARGUE THAT. LET’S TALK ABOUT — TO THE ENTREPRENEURS FOR A SECOND HERE. BECAUSE — LET’S BRING IT BACK AROUND FROM BUREAUCRACY BECAUSE THAT’S BORING. BUT LET’S TALK ABOUT BUILDING THAT COMPANY. BECAUSE IT’S A RISKY BUSINESS FOR SOMEBODY WHO WANTS TO — IF THAT FIRST SATELLITE HADN’T MADE IT INTO SPACE, WOULD THAT HAVE BEEN AN ISSUE FOR YOU?>>IT DEFINITELY WOULD HAVE BEEN AN ISSUE. I MEAN, WE WERE EXTREMELY FORTUNATE AND LUCKY THAT IT WORKED. I BELIEVE THAT ALSO THE AMOUNT OF WORK AND EXPERTISE HELPS A LITTLE BIT OVER THERE. BUT IT’S INTERESTING WITH SPACE BECAUSE THEY HAVE THOSE MILESTONES THAT ARE EXTREMELY BINARY. YOU LAUNCH A SATELLITE, IT EITHER WORKS OR IT DOESN’T. IT CHANGES A LOT WITHIN YOUR BUSINESS PLAN AND IT’S REALLY DIFFICULT BECAUSE OF HOW MUCH IT COSTS TO LAUNCH THE SATELLITE AND HOW MUCH IT TAKES TO BUILD A NEW ONE. IT’S DIFFICULT TO SORT OF PLAN FOR THE PESSIMISTIC SCENARIO THAT YOUR FIRST SATELLITE FAILS. IT IS REALLY, REALLY TRICKY. I GUESS AN INTERESTING THING FROM OUR PERSPECTIVE AND BACK TO YOUR QUESTION A LITTLE BIT, HOW DID IT COME TOGETHER AND WHEN WE WERE STARTING DID WE THINK IT WOULD BE SO LARGE? IN OUR AREAS WE DIDN’T. SO WE WERE REALLY EXCITED ABOUT HAVING THE OPPORTUNITY TO LAUNCH THE FIRST SATELLITE. WE WERE — WE MADE OUR PEACE WITH THE IDEA THAT IT MIGHT NOT WORK AND IT WILL MAKE IT VERY DIFFICULT. OF COURSE WE HAD PLAN “B,” BUT IT WAS ALREADY SO MUCH HAS HAPPENED IN TERMS OF WE MANAGED TO REACH OUR DREAMS. OKAY, WE WERE GOING TO BUILD SOMETHING TOGETHER. WE HAVEN’T REALIZED THAT IT WILL GO TO SPACE. SO THE IDEA OF GOING INTO SPACE — [ INDISCERNIBLE ]. IT WORKED.>>BUILD A SPACE START-UP WITHOUT GOING INTO SPACE?>>WE STARTED WITH THE IDEA THAT OF COURSE IT WOULD GO TO SPACE. BUT YOU HAVE TO — IT GROWS ALONG WITH YOU, AND AS THE COMPANY GROWS YOU START TO REALIZE THAT IT’S BIGGER AND BIGGER AND IT’S BECOME MORE SERIOUS. IT’S A BUNCH OF FRIENDS BUILDING COOL STUFF OUT OF THE GARAGE. AT A CERTAIN POINT IT’S 80 PEOPLE AND THEN YOU’RE BUILDING SEVERAL SATELLITES A YEAR AND THEY’RE ALL BIG AND YOU HAVE TO LAUNCH THEM. IT’S ACTUALLY A VERY INTERESTING GROWTH. WE WERE CHATTING ABOUT HOW IT CHANGES SIGNIFICANTLY BETWEEN 10 AND 30 AND THEN WE’RE DOING 80, SO ON. HOW IT’S A COMPLETELY DIFFERENT WORLD. SO YES, IT IS DIFFICULT BECAUSE OF THIS BINARY NATURE OF LAUNCHES. IT’S A LITTLE BIT EASIER IF YOUR SATELLITES ARE SMALLER. THAT’S PROBABLY THE TRICKIEST PART ABOUT A SPACE START-UP. THE FACT WITH THE FIRST LAUNCH YOU ARE PROVING SO MUCH. THE KEY THING IS FOR YOU TO FIND INVESTORS THAT WILL UNDERSTAND THAT IT DOESN’T MEAN THAT YOU CAN’T DO IT. THE FACT THAT THE FIRST SATELLITE HAS FAILED DOESN’T REALLY MEAN THAT IT’S — THAT YOUR TEAM IS WRONG OR YOU HAVE MADE SOMETHING SUBSTANTIAL. IF YOU CAN BUILD TEN, IF YOU HAVE TEN FAILURES IN A ROW YOU HAVE TO WONDER WHAT’S HAPPENING. BUT THE VERY IMPORTANT PART IS HAVE SOMEONE THAT WILL UNDERSTAND THAT THERE ARE GOING TO BE GOOD TIMES OR BAD TIMES WITHIN THE SPACE INDUSTRY. ONCE YOU HAVE TEN SATELLITES AND ONE FAIL, IT’S NOT TOO BAD. >>YOU HAD TO SAY SOMETHING NICE ABOUT YOUR INVESTMENT. >>AND FROM THE SENSE BECAUSE WE NOT COULD AFFORD AT THE BEGINNING TOO MUCH MONEY, WE WERE ALL THE TIME — NO, FORGET ABOUT THE PROBLEMS BUT WE ARE GOING TO SPACE. ONE LAST WORD FROM ME. I REALLY BELIEVE SPACE WOULD KEEP GROWING LIKE A CRAZY BUSINESS. HOWEVER, I TEND TO BELIEVE THAT WE NEED TO ADDRESS SUSTAINABILITY EARLY ON AND BECAUSE WE STARTED LIKE THAT, WE — OUR COMPANY IS QUITE UNIQUE IN THE SENSE THAT WE ARE A SUSTAINABLE, PROFITABLE BUSINESS FROM ALMOST DAY ONE. IT’S VERY, VERY –>>VERY LITTLE INVESTMENT. >>FROM MAJOR INVESTORS. BUT THE SUBSTANTIAL THREATS IF WE MAKE A MISTAKE IN SPACE, IF WE MAKE A MISTAKE WITH CLIENTS WE KNOW THAT’S THE END GAME. IT REALLY MOTIVATES THE TEAM TO BRING RESULTS EARLY ON ON THE MARKETS. YOU START LISTENING TO THE MARKET. YOU DON’T — YOU START LISTENING TO THE MARKETS. SO I THINK IT’S AN — I HOPE THERE WILL BE MUCH MORE SUSTAINABLE SPACE COMPANIES EARLY ON SO WE CAN LEVERAGE THE DATA AFTERWARDS. >>SINCE WE ARE JUST ABOUT OUT OF TIME, FOR THE START-UPS THAT I HEAR, THEY’RE THINKING ABOUT BUILDING A SPACE START-UP, SOUNDS COOL. WHAT DO YOU LIKE THEM TO — WHAT’S MISSING?>>YOU KNOW, AN UNDERSTANDING OF WHAT IT TAKES IF YOU’RE GOING OUT TO PUT A CONSOLATION TOGETHER. WE JUST ARE REALLY PRIVILEGED TO SEE A LOT OF THE DEAL FLOW WITHIN THE NEW SPACE AREA AND WE HAVE CONVERSATIONS EVERY WEEK WITH THE TEAMS THAT BELIEVE THAT THEY CAN PUT UP A CERTAIN CONSOLATION FOR A CERTAIN PRICE WHICH IS BASICALLY ABOUT A FIFTH OF WHAT IT REALLY IS. WE BELIEVE IT’S COMING DOWN. BUT RIGHT NOW, JUST AN UNDERSTANDING OF WHAT YOU’RE GOING AFTER, HOW YOU’RE DOING IT. AND TO BE TRYING TO BE VERY, VERY LEAN IN THE EARLY DAYS. AGAIN, LAUNCHES ARE — YOU KNOW, THEY TEND TO PUSH OUT SOMETIMES SO WHEN YOU’RE HAVING BURN AND WAITING FOR THAT SATELLITE SOMETIMES YOU GET PUSHED OUT FOUR OR FIVE MONTHS. YOU HAVE TO UNDERSTAND WHAT THAT MEANS FROM A CASH FLOW BASIS. SO WE HAVE A LOT OF GOOD CONVERSATIONS EARLY STAGE ABOUT THAT. >>I WOULD SAY NEW BUSINESS MODELS. SHAPE THE BUSINESS MODEL OF THE EXISTING INDUSTRY AND FIND THE NEW BUSINESS MODEL. TECHNOLOGY IS NOT THE ISSUE. IT’S THE BUSINESS MODEL. THERE YOU CAN REALLY DISRUPT. >>ALL RIGHT. WE’RE OUT OF TIME. I WAS GOING TO TALK ABOUT PUTTING HUMANS IN SPACE TOO, BUT WE’LL DO THAT NEXT TIME. THANK YOU. >>THANK YOU SO MUCH. >>THANK YOU. ♪ ♪>>>OKAY. I KNOW EVERYONE IS EXCITED ABOUT THE BATTLE FIELD FINALS AS AM I. DOES ANYONE HAVE A FAVORITE, WANT TO SHOUT IT OUT? OF COURSE NOT. BUT BEFORE WE HOP INTO THAT WE HAVE BEEN RUNNING THE SHOW F FOR FOREVER IT FEELS LIKE AND THERE ARE HUNDREDS OF COMPANIES THAT HAVE GONE THROUGH THE BATTLE FIELD BEFORE. SOMETIMES WE LIKE TO CATCH UP WITH THEM. SEE WHAT THEY HAVE BEEN UP TO SINCE THEY WERE IN THE BATTLEFIELD. AND THAT’S WHAT WE’LL DO RIGHT NOW. SO PLEASE WELCOME TO THE STAGE MAPIFY. THIS TIME CLAP.>>HELLO TECH TRONS. WE ARE REALLY EXCITED TO BE BACK ON THE STAGE. MY NAME IS SEBASTIAN. AND TOGETHER WITH MY BROTHER PATRICK, I WANT TO SHARE A QUICK UPDATE FROM MAPIFY. WE WANT TO TELL YOU WHAT HAPPENED ON MAPIFY’S PRODUCT AND BUSINESS SINCE WE WERE ON THE STAGE. FOR THOSE OF YOU WHO DON’T MAPIFY LET ME GIVE YOU A QUICK INTRODUCTION. WE ARE BUILDING A SOCIAL NETWORK FOR TRAVELERS TO CONNECT AND PLAN TRAVEL EXPERIENCES IN A SINGLE APPLICATION. 2018 HAS BEEN A CRAZY YEAR FOR US. WE ARE NOW THE FASTEST GROWING TRAVEL NETWORK IN EUROPE AND MAPIFY FEATURES EXPERIENCES SHOT BY TRAVELERS IN NEARLY EVERY SINGLE COUNTRY GLOBALLY. WE ARE EVEN THE MOST HIGHLIGHTED ON THE APP STORE AVAILABLE IN 14 LAIN WANTS. JUST RECENTLY WE COMPLETED A 1 MILLION U.S. DOLLAR TO LAUNCH OUR BASE. THIS FUNDING COMES FROM ENTREPRENEURS AND FUNDS WITH YEARS OF TRAVEL MARKETING EXPERIENCE. AS AN INTRODUCTION TO OUR LATEST PRODUCT UPDATES, WE WOULD LOVE TO SHOW YOU A QUICK VIDEO OF OUR LATEST RELEASE. ♪>>EVERYTHING OF WHAT YOU JUST SAW IS ESSENTIALLY DESIGNED TO MAKE THE MAPIFY CREATION EXPERIENCE EVEN BETTER. AND WHAT WE SEE IS THAT ON OUR iOS COMMUNITY TRAVELERS AROUND THE GLOBE ARE LOVING THIS NEW UPDATE. IT’S COMING TO ANDROID VERY SOON AND IT’S AVAILABLE ON iOS RIGHT NOW. SO LET’S LOOK AT WHAT’S NEXT. WE ARE AMAZED BY HOW MANY TRAVELERS ARE ALREADY SHARING THEIR TRAVEL EXPERIENCE ON MAPIFY RIGHT NOW AND WE WANT OUR CONSUMMATION EXPERIENCE TO SHARE JUST THAT. IT’S ALSO SUPER RELEVANT FOR PEOPLE TO SEE WHAT’S HAPPENING RIGHT NOW AND THAT’S WHY WE WILL BE ROLLING OUT MAPIFY NOW. THIS IS GOING TO BE AN EXPERIENCE ENABLING EACH AND EVERY ONE OF YOU TO SEE THE BEST HIDDEN GEMS NEARBY. BUT ALSO TO HAVE MAPIFY BE YOUR COMPANION WHENEVER YOU’RE ON A TRIP. SO IT’S GOING TO BE AN ALL IN ONE EXPERIENCE. YOU PLAN YOUR UPCOMING ADVENTURE INSIDE THE APP AND THEN MAPIFY WILL HAVE INTERACTIVE ELEMENTS SHOWING YOU AN UBER TO YOUR NEXT AIRBNB. A RESTAURANT RECOMMENDATION FOR TONIGHT OR INFORMATION FOR THE AIRPORT AT WHICH YOU JUST TOOK OFF.>>NO OTHER TRAVEL APP HAS BEEN AS SUCCESSFUL AND WINNING HIGH PROFILE CREATORS TO SHARE THEIR PERSONAL STORIES WITH THE COMMUNITY. MAPIFY GUIDES WILL BUILD ON THAT. WE WANT TO ENABLE FOR MOST OUTSTANDING CREATORS TO SHARE EVEN MORE DETAILED, RICH TRAVEL CONTENT IN PACKAGES READY FOR PURCHASE OR BOOKING. MAPIFY GUIDES WILL BE LAUNCHED IN EARLY 2019 FOR FIVE TO SEVEN LOCATIONS GLOBALLY. WE ARE ABSOLUTELY EXCITED TO SEE WHERE MAPIFY IS HEADING. IT HAS BEEN YEARS SINCE WE LAUNCHED AND WE CAN’T BELIEVE HOW GLOBAL THIS NETWORK HAS ALREADY BECOME. >>THANK YOU SO MUCH FOR TECHCRUNCH FOR PUTTING US BACK ON STAGE AND THANKS FOR ALL INVESTORS AND SUPPORTERS AND THANKS TO ALL USERS OF MAPIFY GLOBALLY, SHARING YOUR EXPERIENCES AND PLANNING UPCOMING ONES AND MAKING THIS THE MOST AWESOME TRAVEL NETWORK. THANK YOU SO MUCH.>>GREAT JOB, GUYS. ALL RIGHT. WE’LL HEAR FROM ONE MORE COMPANY. PLEASE WELCOME TO THE STAGE FAIR FLEET.>>THANK YOU VERY MUCH. TECHCRUNCH, THANK YOU FOR HAVING US BACK ON THE STAGE. I WANT TO GIVE YOU A SHORT UPDATE ON FAIR FLEET AND OF COURSE ON OUR STRAIGHT JOURNEY TO THE TOP. SO AS WE THOUGHT IT’S MAYBE NOT AS STRAIGHT AS FOR OTHER PEOPLE. I BROUGHT TWO OR THREE TOPICS TO DISCUSS. FIRST IS THE BUSINESS MODEL. THREE YEARS AGO WE WERE HERE AND WE LAUNCHED OUR MARKET PLACE FOR DRONE PILOTS. SO WHAT HE WHAT WE WANT TO DO IS — WHAT WE WANT TO DO IS CONNECT THE DEMAND AND SUPPLY OF PILOTS AND CLIENTS BUT WE NOTICED THIS IS NOT GOING TO WORK. THE PILOTS KEPT ASKING US, THE CLIENTS KEPT ASKING US, SO THERE WAS A LOT OF CONFUSION IN THE MARKET. IT’S A NEW TOPIC, NOBODY KNEW WHAT TO DO. SO THIS IS WHY WE WERE — WE AT FAIR FLEET DEVELOPED OUR BUSINESS MODEL TO A FULL SERVICE PROVIDER FOR DRONE SOLUTIONS. WHAT IT MEANS IS THAT YOU CAN ORDER A FLIGHT WITH FAIR FLEET VERY EASILY ON OUR WEBSITE SO IT TAKES YOU ABOUT 30 SECONDS TO ORDER A FLIGHT WITH FAIR FLEET. WE WILL FIND THE RIGHT PILOT AND THE RIGHT LOCATION WITH THE RIGHT CAPABILITY AND EQUIPMENT AND THE PILOT WILL CONDUCT A FLIGHT AND COLLECT THE DATA ACCORDING TO OUR REQUIREMENTS. WHAT THEN HAPPENS IS THAT THE DATA ALSO COMES BACK TO OUR PLATFORM AND WE TRANSFER THE DATA INTO USEFUL INFORMATION. SO WE ARE ON THE ONE HAND MANAGING ALL THE DATA CAPTURING PART, BUT WE’RE ALSO MANAGING THE DATA ANALYTICS PARTS WHICH IS REALLY IMPORTANT FOR OUR CLIENTS TO GET VALUABLE INFORMATION OUT OF THE DATA, WHICH THEY COLLECT. THIS BRINGS ME TO THE SECOND TOPIC. IT’S THE PRODUCT UPGRADE. SO THIS IS WHERE WE MORE OR LESS STARTED THREE YEARS AGO. SO THIS WAS THE FIRST BIG JOB WE DID. IT WAS FOR BOOKING.COM. WE FLEW ALL OF THE DESTINATIONS ALL AROUND THE WORLD. IT’S NICE PICTURES AND IT WAS A NICE PROJECT. AND WE ARE — WE EARNED REALLY GOOD MONEY BUT ACTUALLY IT’S — I MEAN, IT’S A DRONE FLYING AROUND CAPTURING SOME DATA. AND THIS IS NOT ENOUGH. THAT’S NOT HOW WE THOUGHT THE BUSINESS MODEL WOULD WORK IN THE FUTURE ACTUALLY. AS I HAVE TWO MINUTES I’LL LET YOU GUYS WATCH THIS VIDEO FOR A SHORT TIME. HOW THIS EVOLVES NOW IS THAT A TOTALLY DIFFERENT — [ INDISCERNIBLE ]. SO WE ARE CAPTURING FOR EXAMPLE, THERMODATA WITH DRONES. WE ARE CREATING OUT OF THE DATA SO A VERY COMPREHENSIVE INFORMATION ANALYTICS. WE’LL TRANSFER THIS INFORMATION WE CAPTURED AND THE PILOTS CAPTURED INTO OTHER TOOLS SO MAINTENANCE, FOR EXAMPLE, CAN REALLY SEE WHERE IT HAS TO GO, TO CHANGE PANELS. THAT’S THE EVOLUTION OF THE PRODUCTS. THAT’S WHAT WE DO NOT ONLY IN THE VERTICAL AND THE ENERGY, SO IN DIFFERENT VERTICALS LIKE INSURANCE. REAL ESTATE AND INFRASTRUCTURE PROJECTS, OF COURSE. LAST BUT NOT LEAST UPDATE ON THE INVESTORS. SO WE STARTED THREE YEARS AGO AS A PROJECT OF ALLIANZ. THEN WE DECIDED ALONG THE WAY THAT WE’LL HAVE A SPINOFF AND I THINK ONLY TWO OR THREE PEOPLE IN THE WORLD BELIEVED THAT WE WILL MANAGE TO SPIN OFF A PROJECT OFF OUT OF THE WORLD’S BIGGEST INSURANCE COMPANY. BUT WE ACTUALLY DID. AND THIS IS HOW WE ARE SET UP — HOW THE SET-UP LOOKS NOW. SO THIS SUMMER WE CLOSED OUR — WITH THE GERMAN HIGH-TECH FIRM. AND A COUPLE OF DAYS AGO WE ACTUALLY ANNOUNCED ANOTHER ROUND WITH OUR FRIENDS FROM 3-E C CAPITAL GROUP AND WE HAVE ANOTHER ONE WHO ALSO JOINED THE COMPANY. SO WE COULD REALLY GROW THE BUSINESS. WE HAVE NOW 1,800 PILOTS, ACTIVE FOR FAIR FLEET IN OVER 45 COUNTRIES. WE ALSO SERVED OVER 100 CUSTOMERS COMING FROM DIFFERENT VERTICALS. I THINK THERE’S SOME MEANINGFUL NAMES AMONG THEM. SO THAT’S IT. THANK YOU VERY MUCH.>>THANK YOU. OKAY. I KNOW, BATTLEFIELD FINALS, BUT BEFORE THAT, WE’LL TALK ABOUT THAT. AND WE ARE GOING TO CHECK OUT A HIGHLIGHT VIDEO OF SOME OF THE BEST MOMENTS FROM THE BATTLEFIELD. SO LET’S ROLL THAT VIDEO. ♪ ♪♪ ♪ ♪>>>OKAY. IT’S THAT TIME. THE WINNER OF THE TECHCRUNCH DISRUPT 2017 BERLIN START-UP BATTLEFIELD IS — >>LEAH DIAGNOSTICS. ♪ ♪♪>>HELLO, EVERYONE. WELCOME TO THE FINALS OF THE START-UP BATTLEFIELD. SO WHAT WE’RE GOING TO DO NEXT IS WE’RE GOING TO GIVE YOU A BRIEF OVERVIEW OF THE COMPANIES IN THE FINALS. DO YOU WANT TO INTRODUCE YOURSELF?>>HI, I’M MISCHA, I MANAGE THE START-UP BATTLEFIELD AND IT HAS BEEN AN ABSOLUTE HONOR AND PLEASURE TO WORK WITH ALL THE START-UPS. SO CAN WE HAVE A BIG ROUND OF APPLAUSE FOR ALL THE START-UPS. >>NOW WE’LL DISPLAY THE NAMES OF THE FINALISTS IN THE ORDER THAT THEY WILL PRESENT. WHICH IS ALPHABETICAL. DO YOU WANT TO START US OFF?>>ALL RIGHT. WHY DON’T WE BRING UP OUR FIRST COMPANY. OUR FIRST COMPANY IS IMAGO AI, IT’S A QUALITY FOOD INSPECTION SYSTEM. >>THE NEXT COMPANY THAT WILL PRESENT IS KALEPSO. CYBER SECURITY START-UP FOCUSSING ON DYNAMIC DATABASE ENCR ENCRYPTION. >>OUR THIRD COMPANY IS LEGACY. LEGACY IS AN AT-HOME SPERM DEPOSIT SERVICE WITH OFF SITE STORAGE AND SERVICES. >>THE THIRD ONE IS POLYTEIA A DATA POWERED GOVERNANCE PLATFORM FOR CITY PLANNING AND DECISION MAKING. >>EXCELLENT. OUR FINAL COMPANY, SPIKE ANALYTICS. SPIKE IS A SMART MOBILE ASSISTANT FOR DIABETES MANAGEMENT. >>SO THOSE COMPANIES ARE GOING TO COME OUT, PRESENT. THEY’LL GET GRILLED BY OUR FINALIST JUDGES. SO SEE YOU BACK OUT HERE MOMENTARILY. >>THANK YOU. >>THANK YOU. ♪ ♪ ♪ ♪>>>LADIES AND GENTLEMEN, PLEASE WELCOME TO THE STAGE TECHCRUNCH SENIOR WRITER AND YOUR BATTLEFIELD HOST ANTHONY HA.>>HELLO! SO I THINK YOU HAVE ALL FIGURED OUT AT THIS POINT WE ARE HERE FOR THE FINALS OF THE START-UP BATTLEFIELD. YOU ALL KNOW THE FINALISTS ALREADY. YOU WILL SEE THEM COME OUT ONCE AGAIN. JUST AS A REMINDER, WE GET HUNDREDS — I THINK MORE THAN A THOUSAND APPLICATIONS AND THEN OUR TEAM NARROWS IT DOWN TO THE 13 START-UPS WHO PRESENTED YESTERDAY. FROM THOSE 13 WE HAVE CHOSEN THIS FINAL FIVE. THEY’RE GOING TO PRESENT FOR SIX MINUTES. AGAIN, AS A REMINDER THERE ARE LIVE DEMOS WHICH OFTEN MEANS THAT ANYTHING COULD HAPPEN. THEN THERE’S GOING TO BE Q&A. WE HAVE A WHOLE NEW SET OF JUDGES. WE’RE GIVING THEM A LITTLE BIT MORE TIME FOR IN DEPTH Q&A. WE’LL GIVE THEM TEN MINUTES, AND THEN AT THE END OF THAT THEY’LL GO BACK, WE’LL CHOOSE A WINNER. WHICH WE’LL ANNOUNCE AT THE VERY END OF THE CONFERENCE. THAT WINNER GETS A DISRUPT CUP, GET $50,000 EQUITY FREE AND OF COURSE THE MOST EXCITING THING THEY GET TO SAY THEY’RE THE WINNER OF DISRUPT BERLIN. THAT’S ALL YOU NEED TO KNOW. LET’S BRING OUT OUR JUDGES. FIRST UP, WE HAVE SOPHIA BENDS, A PARTNER AT A COMPANY FOCUSED ON NORDIC ACTIVITIES. SHE WAS THE MARKETING DIRECTOR AT SPOTIFY FROM 2013 TO 2014. NEXT WE HAVE SOMEONE WHO YOU SAW AT THE VERY BEGINNING OF TODAY, THE MANAGING DIRECTOR AT GENERAL CATALYST. IN HIS EIGHT YEARS AT GENERAL CATALYST HE HAS BEEN INSTRUMENTAL IN SNAP, WAG AND OTHERS. NEXT WE HAVE LUCIANO LIXANDRU, PRIOR TO ACCEL, SHE WAS WITH SUMMIT PARTNERS. NEXT WE HAVE MATTHEW, THE EDITOR-IN-CHIEF OF TECHCRUNCH. BEFORE THAT, HE WAS A RETAIL JOCKEY. HE FOUNDED A PRO PHOTOGRAPHY BUSINESS AND A NEWS BLOG COVERING THE APPLE ECOSYSTEM. NEXT WE HAVE THE CEO AND COFOUNDER OF THE FEMALE HEALTH APP CLUE. CLUE CURRENTLY HAS MORE THAN 10 MILLION ACTIVE USERS IN MORE THAN 190 COUNTRIES. AND LAST, BUT NOT LEAST, WE HAVE MATT TURK, MANAGING DIRECTOR AT FIRST MARK CAPITAL. PRIOR TO FIRST MARK HE WAS THE MANAGING DIRECTOR AT BLOOMBERG VENTURES WHICH HE HELPED TO START. GIVE IT UP FOR ALL OF OUR JUDGES. AND WITH THAT, WE’RE GOING TO BRING OUT OUR FIRST FINALIST. THAT FINALIST IS IMAGO AI. PRESENTING ARE –>>HI. SO BY 2050 WE NEED TO FEED 2 BILLION MORE PEOPLE AND YET EVERY YEAR $1.3 BILLION OF FOOD IS WASTED. DUE TO SUBSTANDARD SEEDS, DISEASE. FOR SEED MANAGING COMPANIES — [ INDISCERNIBLE ]. WE HELP THE COMPANIES TO DEVELOP NEW IDEA OF SEEDS BUT LOOKING AT THE QUALITIES SUCH AS THE CROP, THE LENGTH OF FOOD. COMPANIES CAN MAKE KEY DECISIONS. PLANNED BREEDING IS A VERY COSTLY AND COMPLEX PROCESS. IT TAKES AROUND SIX TO EIGHT YEARS TO DEVELOP NEW SEEDS. CURRENTLY, WHAT IS USED TO MEASURE THE QUALITY ARE INACCURATE, TIME-CONSUMING AND LABORIOUS. HANDLING INSTRUMENTS SUCH AS SCALES, AND EVEN MECHANICAL SOILS. THEY ARE NOT APPROPRIATE FOR THAT WHICH INTRODUCES HUMAN BIAS, DECREASE — INTRODUCING IMAGO AI. IMAGO AI PROPRIETARY TECHNOLOGY ALL THE QUALITY ASSESSMENT OF AGRIFOOD PRODUCTS BY CLICKING AN IMAGE. WE DECREASE PHENOTYPING TIME BY 75%, INCREASE SEED HYBRID SELECTION ACCURACY AND INFORM KEY DECISION MAKING — INCREASING THE GENETIC GAIN. HENCE, THE PHENOTYPE DATA COLLECTED THROUGH THE SOFTWARE HELPS THE COMPANIES TO PRODUCE BETTER QUALITY OF SEEDS IN LESSER TIME. SO IMAGINE WHO IS TRYING TO FIGURE OUT WHICH CROPS TO BREED NEXT BECAUSE THIS SEASON CROPS HAVE LOTS OF DISEASE. LET’S MOVE TO THE DEMO. HERE, THE BREEDER WANTS TO CALCULATE HIS PLANT. A HIGHLY PARTICULAR TRAIT. SO HE — HE GETS IT DIRECTLY FROM THE FIELDS. SO WHAT YOU ARE SEEING HERE IS AI SYSTEMS CALCULATING EXACTLY THE PERCENTAGE OF THE INDIVIDUAL PLANT. AND EVEN HIGHLIGHTING THE DISEASE ISSUES SHOWN IN THE YELLOW COLOR. BACK TO THE PRESENTATION. BREEDERS CAN ALSO DO SCIENCE ANALYSIS ON TOP OF THE — HENCE, A PLATFORM PROVIDE ON THE SEEDS, PROGRESSION OF THE SEEDS AND LIKELIHOOD OF INFECTION FROM THE SAME SET OF SEEDS. NEXT SLIDE, PLEASE. OUR DIFFERENT TECHNOLOGY IS BUILT WITH AI, COMPUTER VISION AND MACHINE LEARNING. SO AI IS BUILT WITH THOUSANDS OF CROP IMAGES COLLECTED FROM THE FIELD. SO OUR TECHNOLOGY IS INDEPENDENT OF THE METHOD, EITHER BY HAND DEVICES OR BY DRONES OR EVEN WITH SATELLITE IMAGINARY TO PREDICT THE ADVANCES. TALKING ABOUT THE COMPETITION, IMAGO DOES PHENOTYPING FROM THE GROUND WHICH IS NOT SELF-SUFFICIENT. AND THEY WILL ASK FOR THE MENU SELECTION OF THE PLANTS. IT INTRODUCES BIAS AND EVEN SOME OF THE TRAITS ARE BEYOND HUMAN CAPABILITY TO MEASURE PRECISELY. IMAGO AI PROVIDES A COMPLETELY AUTOMATED REALTIME SOLUTION. THE MARKET SIZE IS MORE THAN $10 BILLION. IN FACT, LAST YEAR A MULTIBILLION DOLLAR SEED COMPANY DID 2 MILLION FIELD TRIALS WHERE THEY HAD TO MEASURE THE MILLIONS OF PLANTS. IMAGO AI IS USED BY THE FOOD COMPANIES TO INSPECT THEIR PARAMETERS AND THE AI MARKET IS GROWING AT 47%. WE HAVE ALREADY ON BOARDED ONE OF THE LARGEST SEED COMPANIES CONTROLLING 40% OF THE GLOBAL MARKET SHARE. DuPONT IS ONE OF OUR PAYING CLIENTS. WE ARE ALREADY LEARNING THROUGH THE PILOTS THROUGH THE COMPANIES. WE ARE IN TALKS WITH MICROSOFT FOR POTENTIAL PARTER INSHIP — PARTNERSHIP. WE HAVE EXPERIENCED COMPUTER VISION AND FROM GOOGLE WITH COMBINED EXPERIENCE OF MORE THAN 50 YEARS. WE ALSO HAVE COMPLIMENTING — FROM THE FOOD EXPERTS FROM MULTIBILLION DOLLARS COMPANIES. HENCE, SEED MANUFACTURING COMPANIES AND FOOD PROCESSING COMPANIES LOOKING FOR AI ENABLED QUALITY, GO TO IMAGO AI TODAY AND SAVE MILLIONS OF DOLLARS. THANK YOU.>>ALL RIGHT. JUDGES.>>I HAD ONE QUESTION. THANK YOU FOR A GREAT PRESENTATION. SUPER EXCITING WHAT YOU GUYS ARE WORKING ON. SO IF I’M A FARMER AND YOU HELPED ME TO DIAGNOSE THE CONDITION OF THE PLANT ARE YOU SELLING ME THE CURE? LIKE THE — THE METHOD I NEED TO USE IN ORDER TO MAKE THEM HEALTHY? OR IS IT JUST THE DIAGNOSIS YOU’RE HELPING WITH?>>SO ALONG WITH THE DIAGNOSIS WE ALSO DO THE RECOMMENDATION MEASURES AND WE SELECT THE TECHNOLOGY AND THEY PROVIDE IT TO THE FARMERS. >>SO YOU DON’T SELL ME THE PRODUCT THAT WILL GET THE PLANTS HEALTHY?>>YES, SO THE COMPANY — THEY DIAGNOSE THE ISSUE AND YOU BUY FROM THE NEAREST DEALER.>>HOW DOES IT WORK? HOW MUCH CONTROL DO YOU HAVE OVER THAT STUFF?>>SO WE SELL IT TO THE COMPANIES AND THE COMPANIES USE THIS TECHNOLOGY IN THEIR RESEARCH TRIALS AND FOR COMMERCIAL PURPOSES AS WELL. SO OUR PRODUCT FOR OUR PLANT PHENOTYPING THAT’S FOR THE RESEARCH FIELD TRIALS AND OUR PRODUCT — FOR COMMERCIAL PURPOSES THAT’S FOR DISEASE PRESENTATION. AND THAT SORT OF STUFF. >>THANK YOU FOR A VERY PASSIONATE PRESENTATION. I ENJOYED IT. HOW — WHAT KIND OF DATA SOURCES DID YOU START WITH INITIALLY IN ORDER TO GET YOUR ALGORITHM UP TO SPEED FIRSTLY? AND SECONDLY, HOW DO YOU MEASURE ACCURACY OF YOUR TOOL?>>SURE, SO THAT IS ONE OF THE INTERESTING POINTS ABOUT TECHNOLOGY. SO WE ARE COMBINING DEEP LEARNING WITH VISION PROGRAMMING SO WITH THE DEEP LEARNING IT’S NOT POSSIBLE TO BUILD WON 15 IMAGES WHICH WERE DOING AND WE’RE BUILDING OUT THE THOUSANDS OF IMAGES. WHEN THEY DON’T HAVE A HUGE AMOUNT OF DATA SITES, IT’S A SEPARATE PROJECT FOR THEM TO COLLECT THE DATA SET. SO WE ARE ABLE TO DO WITH IT LESS THAN 15 IMAGES. JUST ON THE MODELS. ON THE ACCURACY PART, WE HAVE ACHIEVED 90% OF ACCURACY. AND SO WITH THE FARMERS AND WITH THE RESEARCH, SO THIS IS THE KIND OF ACCURACY WE ARE TALKING ABOUT.>>SO YOU ONLY HAD 50 IMAGES TO FIGURE OUT FOR EACH PARTICULAR TYPE OF CROP WHAT –>>YES. YES. WELL, LESS THAN 50 IMAGES. WE ARE RESEARCHING OUR TECHNOLOGY TO DRILL DOWN THE NUMBER OF DATA POINTS BELOW TEN. SO IT’S — THE IMAGES, BUT A BIT MORE –>>SO 50 IMAGES PER PHENOTYPE?>>YES. SO THAT WE CAN SAY — SO YOU WANT TO IDENTIFY JUST — WE WOULD REQUIRE 50 FOR THEM. >>IS IT BECAUSE THERE ARE FEW TYPES OF DISEASES THAT ARE 90% OF THE CASES?>>IT’S INDEPENDENT OF THE NUMBER. SO IT CAN BE A THOUSAND. IT CAN BE ANY NUMBER OF DISEASES SO WE REALLY — [ INDISCERNIBLE ]. AND WE’RE DOING MULTITASK LEARNING. WHAT DOES IT MEAN, WE NEED THE AI MODEL FOR IDENTIFYING THE LENGTH OF THE FOOD AND THIS WAY WE ARE MAKING LEARNING AND PREDICTION MORE ACCURATE. THIS IS THE WAY THAT THE HUMAN LEARNS. WE DON’T NEED TO IDENTIFY ONE OBJECT, SO WE’RE MIMICKING REALLY HOW THE HUMAN LEARNS.>>THANK YOU. >>I HAVE A QUESTION AROUND YOUR CUSTOMERS. SO YOU’RE A B TO B SO HOW MANY OF PLANT SEED DEVELOPERS ARE THERE IN INDIA OR WORLDWIDE? BECAUSE I’M SITTING HERE THINKING ISN’T MONSANTO OWNING EVERYTHING? DO YOU NEED ONE GOOD CUSTOMER, WHO IS YOUR CUSTOMER REALLY?>>SO THERE ARE MULTIPLE SEED COMPANIES AND SO IF YOU TALK ABOUT THE BIG SEED COMPANIES THAT ARE CONTROLLED — BY THE LARGEST COMPANIES THEY CONTROL 40% OF THE GLOBAL MARKET. >>40%?>>YEAH. THE BIG SEED COMPANIES, THERE ARE ABOUT THREE BIG SEED COMPANIES. SO THEY CONTROL THE MEDIA MARKET SHARE UP TO 85% AND THEN THERE ARE REGIONAL COMPANIES IN COUNTRIES LIKE INDIA. SO THEY HAVE VERY A MINORITY SHARE. 10 TO 15%, THAT SORT OF SHARE. >>WHO OF THEM ARE YOU TARGETING?>>SO WE ARE TARGETING THE BIG MULTINATIONAL COMPANIES AND THE MEDIUM SIZED COMPANIES. NOT AT PRESENT TARGETING THE SMALL COMPANIES BECAUSE THE BIG — >>SO MY NEXT QUESTION IS BECAUSE YOU SAY THAT ESSENTIALLY WE NEED TO FEED MORE PEOPLE IN THE WORLD. BUT IF YOU’RE HELPING THE BIG SEED COMPANIES DO BETTER, WILL THAT ACTUALLY TRICKLE DOWN?>>YES. >>OR WILL IT JUST GET BETTER PROFITS?>>NO, LIKE USING THAT TECHNOLOGY, THE SEED COMP COMPANIES — THE SEED THEY’RE ABLE TO PRODUCE USING OUR TECHNOLOGY. ONE THING IS IT TAKES THEM LESS AMOUNT OF TIME AT PRESENT. IT WOULD TAKE THEM SEVEN TO EIGHT YEARS PRODUCE A NEW SEED VARIETY. IT TAKES LESS TIME AND THE SECOND TIME IS THAT THEY’RE ABLE TO PRODUCE SEEDS WHICH HAVE — WHICH ARE MORE DISEASE DISTINCT AND WHICH CAN PRODUCE BETTER YIELD. WHEN THEY CAN PRODUCE BETTER YIELD AND MORE DISEASE RESISTANT, WE HAVE BETTER FOOD FOR THE PEOPLE. >>FOR EXAMPLE, THE PILOT — FROM EARLIER, THEY TOOK TWO DAYS TO DO ALL OF THE PHENOTYPING AND WE REDUCED THE TIME. >>SO IN ADDITION TO THAT, LIKE SO THERE IS 30 TO 40% OF THE CROP THAT IS LOST. JUST BECAUSE OF DISEASE INSECTS AND THE FARMER CAN USE PESTICIDES OR WE CAN IMPROVE THE QUALITY OF SEEDS THAT ARE MORE — [ INDISCERNIBLE ].>>HOW DO YOU THINK ABOUT LOCATION? BECAUSE PRESUMABLY THERE’S THE SEED DISEASE BUT ALSO HOW IT INTERACTS WITH ITS ENVIRONMENT. IS THAT A FACTOR?>>YES. SO EVERY SEED THAT I I.D., THAT IS HOW THIS PHENOTYPE WHAT APPEARS TO US. LIKE THE LENGTH OR THE PARAMETERS THAT’S THE PHENOTYPE. SO THE GENETICS OF THE SEED THAT TRACKS WITH THE LOCAL ENVIRONMENT. THE PHENOTYPE IS WHAT WE CREATE. IT CAN BE VARIOUS OTHER TRAITS.>>SO YOU CAPTURE LOCATION DATA AND CROSS WIT THE — CROSS IT WITH THE PHENOTYPE DATA?>>THAT IS THE NEXT STEP IF WE WANT TO PREDICT HOW THE GENETIC DATA IS ACTUALLY GOING TO INTERACT WITH THAT ENVIRONMENT, THEN WHAT KIND OF PHENOTYPE WE CAN EXPECT FROM THAT DATA. AT PRESENT, WE JUST NEED ANY SORT OF VISUAL TRAIT THAT IS INDEPENDENT OF THE LOCATION. >>SO THIS IS CALLED GENETIC ENVIRONMENT INTERACTION. FROM THE MULTIPLE SOURCE, WE ARE BACK UP WITH THE DATA SET AND THEN WE’LL PUT ENVIRONMENT AS ONE OF THE VARIABLE. AS THE GENETIC DATA — ONE MORE POINT AS WE TALK ABOUT THE VISUAL FEATURES AS OF NOW, YOU SAW THE FEATURES, NOW WE’RE ENTERING INTO THE HYPER — AS WELL. THAT IS BEYOND AS WE CAN SEE. THIS HAS A HUGE SCOPE IN THIS INDUSTRY. FOR EXAMPLE, MINING FOR FOREIGN PARTICLES, HUMAN HAIR, AND — [ INDISCERNIBLE ]. SO WE ARE MINING THIS AS WELL. >>SO WHY ARE YOU THIS BEST PEOPLE IN THE WORLD TO BUILD THIS TO A MASSIVE BUSINESS?>>SO WE ALREADY HAVE THE RICH DATA SET REQUIRED TO BUILD THE MODELS. WE HAVE THE FIELDS AND WE HAVE DATA FROM THE DIFFERENT COMPANIES. SECONDLY, WE ALREADY HAVE THE TECHNOLOGY WHICH IS MORE THAN 99% ACTIVE AND SO ALSO A DEEP KNOWLEDGE. THE MAIN KNOWLEDGE THAT’S REQUIRED TO BUILD THIS SORT OF THING. ALSO WE HAVE THE SMALL ADVANTAGE THAT HELPS WITH THE SEED COMPANIES, 40% SHARE SO WE HAVE THAT SORT OF DOMAIN KNOWLEDGE AND THIS WILL HELP US IN SCALING UP.>>HOW BIG IS YOUR TEAM TODAY?>>SO WE ARE A TEAM OF TEN PEOPLE, BUT WE ARE LOOKING FOR FREELANCERS. SO FOOD CONSULTANTS. >>THAT’S GREAT. THANKS. >>WHAT OTHER VERTICALS DO YOU SEE YOURSELF MOVING INTO?>>SORRY?>>DO YOU SEE YOURSELF MOVING INTO ANY OTHER VERTICALS, ANY OTHER AREAS THAT YOU CAN APPLY THE TECHNIQUE TO?>>YES. SO AT PRESENT, WE ARE FOCUSING ON THE AGRICULTURE COMPANIES AND THE NEXT IS EXPANDING INTO THE FOOD COMPANIES. THERE’S A HUGE MARKET THERE AS WELL. >>[ INDISCERNIBLE ]. >>HOW MUCH MONEY CAN DuPONT PAY YOU EVERY YEAR?>>OKAY. SO THIS DEPENDS ON THE COMPLEXITY OF THE TRAITS. SO IT CAN REACH FROM $40,000 TO MILLIONS OF DOLLARS DEPENDING ON THE COMPLEXITY AND HOW THAT PARTICULAR INFORMATION IS USEFUL TO THEM IN PRODUCING A BETTER SEED AND IN HOW MUCH LESS TIME. SO WHEN WE SAY THAT WE ARE ALSO WORKING ON PREDICTING THE PHENOTYPE FROM THE GENOTYPE SO WE DON’T NEED THAT TO DO THAT. SO THIS SAVES MONEY TO DuPONT AND LESS AMOUNT OF TIME. MAYBE WITHIN A FEW MONTHS THEY CAN INTRODUCE A NEW SEED VARIETY INTO THE MARKET. SO THAT’S A HUGE OPPORTUNITY. >>ALL RIGHT. ONE MORE ROUND OF APPLAUSE FOR IMAGO AI. LET’S BRING OUT OUR NEXT FINALIST. THAT FINALIST IS KALEPSO. HERE ARE THE PRESENTERS.>>HI. I LOVE QUIZZES. WHAT DO EQUIFAX AND UBER ALL HAVE IN COMMON? IT’S THE RECENT DATA SCANDALS. SO MORE THAN 150 MILLION RECORDS WERE BREACHED BY EQUIFAX. THESE ARE RECORDS OF PEOPLE LIKE YOU AND ME. MORE THAN 60% OF COMPANIES HAVE ALREADY BEEN BREACHED. SO IT’S NO LONGER A QUESTION OF WHETHER A BREACH WILL OCCUR, BUT RATHER WHAT THE COST OF THIS BREACH WILL BE. ENCRYPTION IS THE MOST EFFECTIVE MEASURE IN MITIGATING THIS RISK SO THAT’S WHY WE STARTED KALEPSO. KALEPSO IS THE FIRST CLOUD DATABASE SOLUTION, SO THE DATA REMAINS ENCRYPTED, ADDRESSED, IN TRANSIT AND IN MEMORY AT THE DATABASE STORAGE. WHILE ENCRYPTED ONE IS ABLE TO FETCH THE DATA BACK IN A PRIVATE WAY AND ONLY THERE DOES THE DATA GET DECRYPTED. WE HAVE MUCH MORE THAN ENCRYPTION. WE ARE A PRIVATE SEARCH ENGINE ON TOP. THE KEY NEVER GETS REVEAL AND NO APPLICATION CHANGES ARE REQUIRED. IMAGINE YOU HAVE YOUR GOLD MINE OF DATA IN A CAVE. ALIBABA FINDS THE SECRET PHRASE TO IT. HE WALKS IN, BUT HE FINDS THIS GOLD DATA. BECAUSE KALEPSO ACTUALLY CONCEALS THE DATA AGAINST ANY DATABASE ATTACK. THIS IS A USE CASE WE’LL WITNESS NOW IN OUR DEMO. IT’S A USE CASE WE’RE WORKING TOGETHER WITH ONE OF THE TOP U.S. BANKS. THEY’RE PULLING TOGETHER IoT DATA ON TO THE CLOUD AND THEY WANT TO BE ABLE TO RUN ANALYTICS IN A SECURE WAY. SO SWITCH TO DEMO. SO HERE WE’RE SEEING IoT DATA ON FRAUDULENT ACTIVITY. FIRST WE’RE GOING TO SEE HOW ANY UNAUTHORIZED USER WITH ROOT ACCESS TO THE STORAGE CAN VIEW THIS DATA. EVERYTHING YOU WILL SEE HERE APPEARS PLAIN. THIS IS CUSTOMER TRANSACTIONAL DATA. MOVING TO KALEPSO, WE INTERCEPT THE DATA STREAM AND ENCRYPTS IT IN REALTIME. THIS IS A CLOUD PROVIDER AND YOU CAN DO NOTHING, IT’S JUST RUBBISH THAT THEY CAN SEE. BUT ALSO ON TOP OF THIS INCRYPTED DATA, SOMEONE CAN RUN SQL QUERIES SO AN ANALYST WANTS TO FIND OUT WHAT’S THE AVERAGE SPENT ON THE FRAUDULENT ACTIVITIES, YOU CAN SEE IT’S DOUBLED. AND THOSE WITH THE QUERY THAT DATA SET GOT DYNAMICALLY REENCRYPTED. SO IF WE GO BACK, YOU CAN SEE HERE THE FIRST — [ INDISCERNIBLE ]. SORRY WE HAVE TO GO BACK TO THE DEMO. THE FIRST — [ INDISCERNIBLE ]. THIS RECORD GOES TO DYNAMIC ENCRYPTION. SWITCH TO PRESENTATION, PLEASE. SO THE QUESTION IS HOW DO WE DO IT? AT THE LOW LEVEL WE USE ESTABLISHED CRYPTO GRAPHIC SCHEMES SUCH AS AES AND ON TOP OF IT WE COMBINE CRYPTOGRAPHY WITH DIFFERENTIAL PRIVACY IN ORDER TO ENSURE AN EFFICIENT AND SECURE INDEXING OF THESE RECORDS. THIS IS A PROPRIETARY TECHNOLOGY THAT MY COFOUNDER DEVELOPED AT HARVARD. SO IT’S ONE OF THE MOST COMMON NAMES IN GREECE, BUT LUCKILY ENOUGH WE DIDN’T JOIN FORCES BECAUSE OF THE NAME. MY BACKGROUND IS ENGINEERING FROM CAMBRIDGE AND I SERVED AS THE HEAD OF THE REALTIME DATA AND ANALYTICS FOR BARCLAYS. I WANTED TO MOVE THE PRODUCT TO THE CLOUD BUT QUICKLY REALIZED THAT WE COULDN’T FIND THE SOLUTION THAT COULD MAKE THE COMPLIANCE TEAMS HAPPY. IF YOU LOOK AT THE EXISTING ENVIRONMENT, SOLUTIONS LIKE ORACLE TRANSPARENT ENCRYPTION REVEAL TOO MUCH INFORMATION. ON THE OTHER END, MICROSOFT’S ALWAYS ENCRYPTED OR UNVEIL, THEY OFFER SOLID SECURITY BUT AT THE SAME TIME THEY DON’T SUPPORT A LOT OF QUERIES AND THEY HAVE LOWER SPEEDS. SO KALEPSO IS THE FIRST ONE TO OFFER THE TRUE SECURITY WITH ORDERS OF MAGNITUDE HIGHER SPEEDS. THIS IS A GLOBAL MARKET THAT’S PROJECTED TO REACH $1.6 BILLION BY 2022. CURRENTLY WE ARE WORKING WITH DIRECT ENGAGEMENTS WITH FINANCIAL SERVICES, MEDIUM SIZED CLOUD NATIVE COMPANIES AND ALSO DATA PROVIDERS AS CHANNEL PROVIDERS. WE ARE PREREVENUE AND WE HAVE ANNOUNCED A PILOT WITH THE NATIONAL BANK OF GREECE LAUNCHING EARLY 2019. OF COURSE WE’RE RAISING OUR NEXT ROUND WITHIN Q2 2019. THOUSANDS OF YEARS AGO THERE WAS KALEPSO WHOSE NAME SHE WHO KEEPS THINGS SACRED. TODAY WE ARE PASSING THE SUPERPOWERS ON TO YOU. IN ORDER TO HELP YOU DIFFERENTIATE YOUR PRODUCT FOR YOUR CLIENTS BASED ON TRUE SECURITY. THANK YOU VERY MUCH.>>JUDGES?>>ARE YOU GUYS OPEN SOURCE?>>NO, WE ARE NOT OPEN SOURCE. >>AND IN THIS DAY AND AGE IT FEELS HARDER FOR DATABASE, GIVEN HOW THE MARKET IS NOT TO BE OPEN SOURCE. HOW DO YOU THINK ABOUT GOOD MARKET AND DISTRIBUTION?>>THAT’S A GREAT QUESTION. AT THE LOW LEVEL WE ONLY USE PRODUCTS THAT ARE OPEN SOURCING AND OUR COMPONENTS ARE ALSO COMPONENTS THAT HAVE BEEN TESTED THROUGHOUT THE YEARS AND THE DECADES. SO THE PROPRIETARY DATA IS THE WAY WE COMBINE IT TOGETHER. SPECIFICALLY THE WAY WE COMBINE THE ROUNDS WITH DIFFERENTIAL PRIVACY IN ORDER TO MAKE IT HIGH SPEED AND HIDE THE CHANNELS. >>SO FIRSTLY, AWESOME PRESENTATION. IT’S NOT EASY TO MAKE ENCRYPTION SOUND REALLY DYNAMIC AND FUN. SO REALLY WELL DONE. TO BUILD ON THAT, CAN YOU TALK A LITTLE BIT ABOUT — MORE ABOUT THE INITIAL USE CASES AND THEN GO TO MARKET HAND IN HAND WITH THAT. SO IT SOUNDS LIKE YOU WORK WITH A FEW BANKS. MAYBE YOU CAN TALK A LITTLE BIT MORE ABOUT THAT VERTICAL AND HOW YOU’RE GOING TO BUILD UP SALESFORCE TO GO ATTACK THAT VERTICAL IF YOU ARE. >>THAT’S A VERY GOOD QUESTION. SO STARTING FROM THE USE CASE I’LL EXPAND A LITTLE BIT ON THE DEMO WE GAVE. THIS IS A USE CASE WHERE THIS PARTICULAR U.S. BANK IS PULLING TOGETHER LOCALLY IoT DATA WITH SENSITIVE INFORMATION IN THAT. THEY WANT TO STREAM IT ALL TO A PARTICULAR CLOUD PROVIDER AND A STORAGE — A STORAGE SERVER THERE. IN ORDER TO THEN DERIVE ANALYTICS OUT OF IT. WHAT HAPPENS IN THESE USE CASES WE INTERCEPT THAT AND WE MAKE SURE THAT THE DATA IS SECURED AND IN TRANSIT AS ARE ALL REQUIREMENTS AND ALSO THE MEMORY. THE EXTRA ADVANTAGE WE GIVE, WHILE THE DATA IS ENCRYPTED WE THINK THE STORAGE MEMORY AND STORAGE ITSELF YOU’RE ABLE TO RUN DIRECTLY ANALYTICS ON IT, SO SQL QUERIES WITHOUT PUSHING TO ANOTHER STAGING ENVIRONMENT. WE’RE WORKING WITH BANKS, I CAN EXPAND LATER ON IN THE OTHER CASE IF WE WANT TO. NOW ON YOUR POINT, IT WON’T TAKE LONG TO GO THROUGH — WITH THE BANKS. WHICH IS WHY WE’RE WORKING WITH THE PROVIDERS TO GET FASTER FEEDBACK. WITH THIS EXPERT FIRM, SO WE HAVE WORKED TOGETHER WITH THEM, WITH THE STAGING ENVIRONMENT TO ADDRESS SOME PARTICULAR CASES THEY WANTED. AND ALSO WITH A B2B COMMERCE WEB PLATFORM SO THESE ARE SMALLER PROVIDERS WHILE TARGETING AND WORKING TOGETHER WITH THESE LARGER BANKPLAYERS.>>THANK YOU. >>WHAT IS REALLY UNIQUE ABOUT OUR TECHNOLOGY?>>I’LL PASS IT ON TO YOU. >>SO BEFORE IT WAS NOT POSSIBLE TO HAVE SUCH ABILITY ON TOP OF ENCRYPTED DATA WITHOUT REVEALING TOO MUCH. AND THIS IS WHAT WE WERE RESEARCHING. WE SAW THAT THE — THAT NO SOLUTION WAS UNBREAKABLE. IT WAS ALWAYS A WAY TO BREAK AND RECONSTRUCT INFORMATION. IF WE COMBINE PRIVACY TECHNIQUES WITH CRYPTOGRAPHY, THEN WE CAN HIDE ALL OF THIS INFORMATION THAT IS LEAKED AND CREATE A SYSTEM THAT CAN HAVE SEARCHABILITY AND ENCRYPTION. >>SO VERSUS LIKE ALWAYS ENCRYPTED OR OTHER PLAYERS OUT THERE, WHAT APPLICATIONS DOES THIS ENABLE THAT WEREN’T ABLE TO BE ENCRYPTED BEFORE? SO WHAT ADDITIONAL LAYERS OF SECURITY CAN YOU ADD TO EITHER EXISTING OR NEW APPLICATIONS?>>ABSOLUTELY. SO TODAY, ALL APPLICATIONS CAN GET ENCRYPTED IN SOME WAY. SO THE QUESTION THERE IS AT WHICH LEVEL THIS INFORMATION IS ENCRYPTED. BECAUSE EVEN TALKING TO BANKS THEY DON’T APPRECIATE THE SPECTRUM OF ATTACKS THERE. RIGHT NOW YOU CAN GET ENCRYPTION AND WE SHOWED HOW THE DATA LOOKS WITHIN THE MEMORY. SO EVERYTHING IS REVEALED THERE AND IN — WHENEVER SOMEONE GETS ROOT ACCESS OVER THERE. NOW, YOU’RE MENTIONING ALSO PARTICULAR PLAYERS LIKE SMALLER NICHE PLAYERS LIKE IN MEMORY ENCRYPTION. THIS INCLUDES SENSITIVE TRANSACTIONS, PAYMENT DATA, SENSITIVE DEFENSE DATA WHERE YOU WANT THIS HIGH LEVEL OF SECURITY. NOW ONE INTERESTING BIT THOUGH IS THAT WHILE YOU ENCRYPT THE MEMORY IT CAN BE REALLY SLOW. ALL THE OTHER PLAYERS WE SAW THERE AND THAT ADDRESSES YOUR POINT AS WELL, IT’S ALSO THE DIFFERENTIATOR IS ALSO THE SPEED OVER HERE. SO WE ARE ORDERS OF MAGNITUDE FASTER THAN ANY OTHER START-UP THAT IS OUT THERE DOING MEMORY ENCRYPTION. THIS IS THE CORE AROUND OUR IP WHICH WE HAVE APPLIED FOR A GLOBAL PATENT. SO IT’S THE SPEED AT WHICH YOU CAN DO THIS IN MEMORY ENCRYPTION. >>WHAT IS YOUR BIGGEST CHALLENGE? WHAT DO YOU ANTICIPATE TO BECOME YOUR BIGGEST CHALLENGE? IS IT TECHNOLOGICAL CHALLENGES OR IS IT GOING TO MARKET? IS IT CONVINCING THE CUSTOMERS? WHAT DO YOU THINK IT WILL BE, WHAT IS IT RIGHT NOW?>>I THINK THIS IS EXACTLY — ONE OF THE CHALLENGES AND IT CAME OUT FROM COMMENTS AS WELL IN TERMS OF THE ENCRYPTION, HOW DO YOU MAKE IT SEXY? A LOT OF TIMES DECISIONMAKERS IN ORGANIZATIONS DON’T HAVE THE LEVEL OF SOPHISTICATION WHEN IT COMES TO THE ENCRYPTION FIELD. SO WE HAVE TO GO THROUGH THIS PROCESS AND IDENTIFY ALWAYS THE RIGHT CHAMPION. SOMEONE WHO UNDERSTANDS THE MECHANICS AND THEN BE VERY MINDFUL IN HOW WE PROGRESS TO THE DECISIONMAKER THERE. SO IT’S ABOUT THE FACT THAT IT’S SORT OF A NICHE AREA, GETTING PEOPLE TO UNDERSTAND EXACTLY WHAT WE DO. BUT ALSO KEEP THE BIG PICTURE IN THE PAGE AND IN THE CONVERSATION. >>SO FROM THE DATA ANALYST — I CAN RUN A SQL QUERY. WHAT ABOUT FROM A DATA SCIENTIST, I NEED TO BUILD A MACHINE LEARNING MODEL, CAN I DO THAT WITH DATA IN YOUR DATABASE?>>THIS IS OF COURSE POSSIBLE. WHERE OUR TECHNOLOGY CAN FLOURISH THE MOST IS WHEN THE QUERIES OR THEY’RE HIGHLY SELECTIVE. SO IF THE YOU WANT A SMALL PORTION OF THE DATA TO BE RETRIEVED IN ORDER TO RUN YOUR ANALYTICS OR MACHINE LEARNING ALGORITHMS THAN OUR SOLUTION IS THE GO TO SOLUTION FOR THAT.>>LESS RUNNING IT, BUILDING THE MODEL WHERE I NEED TO ROOK AT THE WHOLE DATA –>>THE WHOLE DATA SET. SO IN THAT CASE, OUR SOLUTION IS NOT IDEAL. THE PERFECT SOLUTION WOULD HAVE TO HAVE AN ENCRYPTED BACKUP AND THEN YOU CAN JUST ACHIEVE THE WHOLE THING. RUN YOUR ANALYTICS THERE. >>HOW CAN YOU GUYS MAKE THIS BE A HUGE BUSINESS SO THAT ALL OF US GREEKS WILL BE PROUD OF YOU?>>SO WE HAVE PARTICULAR PLANS RIGHT NOW. WE’RE WORKING ON INTEGRATIONS WITH BIG DATA PLATFORMS. WE ALREADY HAVE INTEGRATIONS WITH MARIA, MY SQL SO WE HAVE THE TRANSPARENT LAYER. BUT OBVIOUSLY A LOT OF CASES AROUND ARTIFICIAL INTELLIGENCE WHERE PART OF THE DATA SET IS REQUIRED. THIS IS WHAT WE’RE WORKING ON. BUT THAT’S NOT THE ONLY THING. SO WE HAVE ALREADY INTEGRATED WITH SGX OFFERED BY INTEL. ONE OF THE LATEST TECHNOLOGIES OUT THERE. AND BY DOING IT WE ACTUALLY NOT ONLY MAKE IT THE ENTIRE — DON’T ONLY COVER THE PROBLEMS THAT INTEL FACES RIGHT NOW, BUT MAKE THE ENTIRE ENCLAVE SECURE. OUR TECHNOLOGY IS NOT JUST ENCRYPTION. WE ARE WORKING ON ADDING ALSO SMART WAYS TO BE ABLE TO IDENTIFY IF AN AUTHORIZED USER ACTUALLY HAS A WEIRD ACTIVITY. BECAUSE WE CAPTURE ALL THE QUERIES AND AT THE SAME TIME, WE’RE BUILDING ON SHARING INFORMATION. SO SECRET SHARING, BEING ABLE TO HAVE TWO ORGANIZATIONS COMMUNICATE PRIVATELY WITH EACH OTHER. SO THESE ARE THINGS IN OUR ROAD MAP THAT ARE COMING AS WE’RE PROGRESSING. >>SO SOUNDS LIKE — [ INDISCERNIBLE ]. SO YOU WANT TO HYPE AND –>>WE DO, YEAH. SO WE’RE BASED OUT OF MONTREAL. SO THERE IS NO SHORTAGE IN THE GREAT TALENT THERE. ONE OF OUR SENIOR ENGINEERS JOINED US FROM INDIA. HE HAS 20 YEARS OF EXPERIENCE SO HE MOVED WITH HIS FAMILY TO JOIN US. WE ALREADY HAVE SOME NEW PEOPLE LINED UP. OUR TECHNICAL INVESTOR — SORRY, ADVISER IS ACTUALLY THE INVENTOR OF DIFFERENTIAL PRIVACY SO IT — SO IT’S THE ADVISERS AND THE PEOPLE WHO ARE TALKING TOGETHER WITH US IN ORDER TO BUILD THIS FUTURE. >>DEPLOYMENT IS TYPICALLY TRICKY. HOW DO YOU DEPLOY?>>SO WE DEPLOYED USING A DOCKER BECAUSE WE WANTED TO BE AN EASY DRAG AND DROP APPROACH. THERE ARE TWO MODES OF DEPLOYMENT. ONE IS A NATIVE API AND THE SECOND IS WHAT I JUST MENTIONED. SO EFFECTIVELY IF YOU’RE USING AN APPLICATION THAT CONNECTS THROUGH THE DRIVERS OR YOU’RE USING AN APPLICATION THAT UTILIZES MY SQL WE HAVE A LAYER THAT’S SEAMLESS THERE. >>GIVE IT UP FOR KALEPSO. >>WELL DONE.>>OUR NEXT START-UP IS LEGACY.>>GOOD AFTERNOON. THANK YOU FOR BEING HERE. >>HELLO. >>HI. >>YOU’RE JUST ONE?>>YES. GOOD AFTERNOON, EVERYONE. I’M HERE TO TALK TO YOU ABOUT LEGACY. FOR THE NEXT 5 1/2 MINUTES I’M GOING TO TALK ABOUT ASSETS, INVESTMENTS AND DEPOSITS WITHOUT REFERRING TO THE FINANCIAL INDUSTRY. BECAUSE LEGACY IS THE ONLY LIFE INVESTMENT YOU’LL MAKE. CAN I GET A CLICKER THAT WORKS? I’M GOING TO KEEP GOING ANYWAY. OVER THE PAST 40 YEARS, MALE FERTILITY HAS HALVED. IN INFERTILITY AFFECTS ONE IN SEVEN GLOBALLY. YOU MIGHT THINK IT FALLS ON THE WOMEN TO HAVE HER EGGS FROZEN. IF YOU THINK ABOUT THAT, THAT’S OUTDATED AND WRONG. 30% OF THE TIME WHEN A COUPLE CAN’T HAVE A CHANGE, THE BURDEN FALLS ON THE MAN. AND IN FACT, EVERY YEAR YOU GET OLDER AS A MAN, THERE’S AN ONGOING DECLINE IN YOUR SPERM QUALITY. HOW MANY OF YOU HAVE CELL PHONES RIGHT NOW? WHERE DO YOU KEEP THEM? IT’S NOT JUST CELL PHONE RADIATION, BUT DRINKING, OBESITY, SEXUALITY TRANSMITTED DISEASES AND THE LIST GOES ON. ALL MEN SHOULD BE THINKING ABOUT FREEZING AND TESTING THEIR SPERM, BUT THE PROBLEM IS THAT THE EXPERIENCE TODAY IS SO AWKWARD AND CLINICAL OF GOING TO THE CLINIC TO DO IT. LEGACY IS THE FIRST COMPANY FOCUSED ON TESTING AND THEN FREEZING MEN’S MOST VALUABLE ASSETS. NOW I’M GOING TO SHOW YOU VERY QUICKLY WHAT THE PRODUCT LOOKS LIKE. THIS HAS BEEN CAREFULLY DESIGNED IN A COUPLE OF KEY WAYS. SO IT IS TWO KEY FEATURES. BEYOND JUST IT IS DESIGNED TO LOOK AND FEEL A PARTICULAR WAY. THIS IS WHAT THE CLIENT RECEIVES AT HOME, DISCREET PACKAGING. HANDWRITTEN INFORMATION, AS WELL AS A UNIQUE CLIENT I.D. THEY GET TWO ITEMS, ONE IS THE DEPOSIT CUP AS WELL AS SOMETHING CALLED A BUFFERING MEDIUM THAT HELPS KEEP THE DEPOSIT VIABLE FOR UNTO 48 HOURS. THAT AND THE SPECIAL INSULATION OF THE BOX MAKES SURE WE CAN PICK IT UP AT THE HOME AND IT’S THEN TESTED AND ANALYZED AND THEN FROZEN. NOW I’M GOING TO SHOW YOU QUICKLY WHAT THE WEBSITE LOOKS LIKE. JUST TO GIVE YOU A SENSE OF THE OVERALL BRANDING. IF WE CAN SWITCH TO LAPTOP TWO, PLEASE. SO THIS IS THE KEY WEBSITE. I’LL SHOW YOU WHAT THE PROCESS LOOKS LIE BECAUSE WE HAVE A CLEAR FIVE STEP PROCESS FOR OUR CLIENTS FROM STEPS ONE TO FIVE. AS PART OF THAT WE HAVE — WE HAVE ALL OF OUR CLIENTS WITH OUR CORE VALUES AS THE COMPANY SO THEY KNOW THAT PRIVACY, QUALITY, SECURITY ARE AT THE HEART OF EVERYTHING THAT WE DO. SO ONCE WE FINISH WITH THE PROCESS WITH THE KIT AND SENDING IT TO BE FROZEN, WE SHARE WITH OUR CLIENTS A PERSONALIZED FERTILITY REPORT. THAT REPORT LOOKS MORE OR LESS LIKE THIS. SO WE GIVE AN OVERALALL ASSESSMENT AS WELL AS PERSONALIZED RECOMMENDATIONS. WE GO OVER THE CORE ELEMENTS OF FERTILITY, CONCENTRATION, MOTILITY, SO ON. WE EVEN TAKE IT ONE EXTRA STEP WHICH IS A DAY AFTER THE DEPOSIT HAS BEEN FROZEN WE DO WHAT’S CALLED A POST THAW MOTILITY CHECK TO MAKE SURE THAT THE SAMPLE IS STILL VIABLE AND CAN BE USED IN THE FUTURE. BACK TO THE SLIDES, PLEASE. THANK YOU. NOW, THE TEAM BLENDS BUSINESS, HEALTH CARE AND FERTILITY EXPERTISE. SO I STUDIED BUSINESS AT WHAT GILL, POLICY AT HARVARD, I WAS A HEALTH CARE CONSULTANT AND I’M CERTIFIED BY THE AMERICAN SOCIETY OF REPRODUCTIVE MEDICINE. THE HEAD OF THE CLINICAL PARTNERSHIPS HELPED TO RUN FOR FIVE YEARS THE LARGEST FERTILITY CLINIC IN COLOMBIA AND HAS WORKED WITH MANY START-UPS FROM MIT AND HARVARD. WE BELIEVE THERE’S AN ADDRESSABLE MARKET OF ABOUT $8 BILLION IN THE U.S. ALONE. AND I DON’T WANT TO GET TOO HUNG UP ON THE OVERALL SIZE BECAUSE THAT’S THE OVERALL ADDRESSABLE MARKET. IF YOU FILTER THE MEN WHO ARE 20 TO 49, THIS IS THE IMMEDIATE MARKET. BUT EXPAND THAT TO THE REST OF THE MEN IN THE U.S. EXPAND THAT TO MEN IN EUROPE BECAUSE WE THINK THAT ALL MEN SHOULD BE THINKING ABOUT TESTING AND FREEZING THEIR ASSETS. NOW, THE CUSTOMERS ARE MEN, BUT IN MANY WAYS WE FOCUS ON THEIR PARTNERS AND THE PEOPLE AROUND THEM. FOR EXAMPLE, 250 COMPANIES IN THE UNITED STATES OFFER FERTILITY BENEFITS TO THEIR EMPLOYEES, FOCUSED LARGELY ON IVF AND EGG FREEZING. WE THINK EVERY ONE OF THOSE COMPANIES SHOULD BE A CLIENT OF LEGACY’S AS WELL. WE ALSO GO DIRECT TO CONSUMER. WE TARGET MEN IN PROFESSIONAL SERVICES FOR THE MOST PART. CONSULTANTS, LAWYERS, HIGH STRESS JOBS, THEY WANT TO HAVE A FAMILY, BUT MAYBE IN THE FUTURE. WE DO A LOT OF WHAT I CALL INDIRECT TO CONSUMER WHICH IS REACHING OUT TO THE PARTNERS. WOMEN ARE THE CHIEF MEDICAL OFFICERS OF THE HOUSEHOLD AND COMPARED TO THE $10,000 PRICE TAG OF EGG FREEZING OUR PRODUCT IS 10% OF THAT COST AND CAN BE DONE AT HOME WITH 100% CUSTOMER SATISFACTION. NOW WE HAVE SOME INDIRECT COMPETITORS, SPERM BANKS, CLINICS, AWKWARD CONSUMER EXPERIENCE. VERY EMASCULATING BRANDING. SO WE ARE TESTING TWO BUSINESS MODELS. ONE FERTILITY AND THE OTHER IS BUNDLED, THE OTHER IS UNBUNDLED WITH AN ONGOING OPTION TO FREEZE IF YOU CHOOSE. ULTIMATELY, THIS IS JUST THE BEGINNING. 23 AND ME. HIMS. ROMAN. THESE ARE COMPANIES THAT HAVE COMPLETELY REVOLUTIONIZED THE WAY THAT PEOPLE THINK ABOUT A VERY PERSONAL AND SENSITIVE TOPIC. TODAY, THESE ARE COMPANIES THAT ARE GROWING AND ARE ONLY GOING TO GET BIGGER. AROUND I SAY ALL — AND I SAY ALL THIS BECAUSE IN THE FUTURE LEGACY WILL BE THE NORM. THANK YOU.>>IT’S A GREAT NAME. >>THANK YOU. >>DO WE HAVE LEGACY.COM. >>WHAT WOULD IT TAKE TO GET LEGACY.COM?>>LEGACY.COM IS UNFORTUNATELY AN OBITUARY WEBSITE. THEY CELEBRATE LIFE AND SO DO WE. >>YOU CAN MERGE?>>ABSOLUTELY.>>SO HOW — HOW DO WE MAKE MONEY HERE, WHO PAYS FOR IT? IT’S A LITTLE BIT UNCLEAR TO ME.>>SURE. SO WHEN OUR CLIENT GOES ONLINE AND ORDERS A PACKAGE, THEY PAY US A CERTAIN AMOUNT. AND THAT GOES TO US. WE THEN PAY THE CLINICS THAT WE PARTNER WITH AND THE CRYOSTORAGE THAT WE PARTNER WITH. >>YOU PAY OUT OF POCKET, OR HAVE INSURANCE?>>RIGHT NOW, THEY PAY OUT OF POCKET. THE LONGER TERM GOAL IS TO GET THIS WRAPPED UP IN EMPLOYEE PACKAGES AND ULTIMATELY INSURANCES AS WELL. >>DO YOU HAVE A B2B COMPONENT NOW OR –>>WE’RE TESTING BOTH. >>OKAY. >>I THINK WE’LL DISCOVER WHERE WE’RE SEEING MORE UPTAKE BUT RIGHT NOW WE’RE IN SERIOUS CONVERSATIONS WITH A FEW COMPANIES THAT OFFER THE SERVICES TO THE WOMEN. >>TYPICALLY IF SOMEONE GOES TO ONE OF THE TRADITIONAL CLINICS, IS THAT REIMBURSED BY INSURANCE OR IS THAT ALSO OUT OF POCKET?>>IT’S A GOOD QUESTION. THAT — THE ANSWER TO THAT IS IT DEPENDS. IF YOU’RE DOING IT FOR WHAT I CALL REACTIVE PURPOSES, FOR EXAMPLE, IF YOU HAVE CANCER. YOU’RE ABOUT TO UNDERGO CHEMOTHERAPY, THAT WOULD BE COVERED UNDER MOST INSURANCES PACKAGES. PROACTIVE, NOT AT THIS TIME. >>HOW MUCH ADVICE DO YOU GIVE? IF SOMEONE SENDS IN AND YOU GET THE RESULTS BACK, IS IT UP TO THE CUSTOMER TO GO TO THE DOCTOR AND GET THE ADVICE OR ARE YOU GIVING THE ADVICE ON HOW TO PROCEED DEPENDING ON THE STATE OF THE SPERM?>>IT’S A GOOD QUESTION AND IT’S A VERY FINE LINE FOR US. WE GET THE CLINICAL RESULTS FROM THE CLINIC AND THESE ARE BASICALLY INCOMPREHENSIBLE TO MOST HUMAN BEINGS. THAT’S WHY WE HAVE A SIMPLIFIED VERSION. HERE IS THE RESULTS THAT YOU HAVE GOT FROM THE CLINIC, HERE HOW YOU CAN THINK ABOUT THEM AND HOW YOU CAN IMPROVE YOUR FERTILITY. IF THAT’S AN INTEREST FOR YOU. >>IS THERE A DATA BUSINESS HERE?>>YES AND NO. THE GOAL IS TO ACTUALLY HAVE PEOPLE FILL OUT A LIFESTYLE FORM SO ABOUT 30 QUESTIONS FROM WHICH WE WOULD BE ABLE TO PREDICT WITH VERY HIGH LEVELS OF ACCURACY WHETHER OR NOT WE THINK THEY’D BE FERTILE OR SUB FERTILE. WE FEED THE DATA INTO IMPROVING THE MODEL BUT GOING BACK TO OUR VALUES AS A COMPANY, PRIVACY IS THE ABSOLUTE NUMBER ONE VALUE. WE DON’T REPACKAGE AND SELL THAT DATA. THAT IS ANATHEMA TO WAY IT IS BUILT. I THINK 23 AND ME HAS REPURCHASED AND RESOLD. THERE WERE A BACKLASH WHEN IT TURNED OUT THEY HAD SOLD A LARGE AMOUNT OF CONSUMER DATA TO ONE OF THE PHARMA COMPANIES SO WE ARE VERY MUCH AGAINST THAT. >>CAN YOU TELL US ABOUT HOW YOU’LL REACH MEN WHO TRADITIONALLY DON’T WANT TO THINK ABOUT THIS? OR MAYBE THEY DO.>>YOU KNOW, I’LL TELL YOU — I THINK ABOUT IT TWO WAYS. SO THE FIRST IS DIRECT CONVERSATIONS WITH MEN. I HAVE HAD WELL OVER 1,000. AND MEN GO FROM THE INITIAL REACTION OF LIKE, WHOA, RIGHT, ALMOST INEVITABLY WITH 99% SUCCESS RATE THEY’LL MAKE A JOKE AGO IT. LIKE, BRO, DO YOU NEED A DEPOSIT? ONCE THEY GET THAT OUT OF THE SYSTEM AND THEY SEE I’M SERIOUS, THEY SHIFT AS WELL. OUR GOAL AS A COMPANY AND THE SUCCESS OF LEGACY RESTS ON OUR ABILITY TO DO THIS IS TO TAKE THE MEN THE JOURNEY OFF OF I NEVER THOUGHT ABOUT IT BEFORE, TO I SHOULD DO IT, TO I DEFINITELY SHOULD DO IT RIGHT NOW. THIS IS THE FOUR-STEP PROCESS WE TAKE MEN ON. SO THIS IS STEP ONE OF THE EQUATION. I THINK THE BEST WAY TO ACCELERATE THAT PROCESS IS TO GO THROUGH THE PEOPLE AROUND THEM. I’LL GIVE YOU A QUICK ANECDOTE. L’OREAL IN CANDIDATE DID A FASCINATING STUDY ON MEN WHO BUY FACIAL PRODUCTS. THEY FOUND IN A THIRD OF THESE CASES, MEN HAD HAD NO ROLE WHATSOEVER IN THE DECISION MAKING PROCESS. THEY HAD BEEN TOLD BY THEIR PARTNER HERE’S WHAT YOU’LL BUY. HERE’S WHERE YOU’LL BUY IT, HERE’S WHERE YOU’LL PAY IT, HOW YOU’LL USE IT. I SEE THE FEMALE JUDGES ARE NODDING ALONG I THINK BECAUSE IT’S SOMETHING YOU HAVE SEEN BEFORE. I THINK WOMEN ARE COMPELLING IN CONVINCING THEIR PARTNER FOR EXAMPLE TO THINK ABOUT THEIR FERTILITY AS WELL. >>WHEN I SEE YOUR WEBSITE I DON’T SEE TALKING TO THE PARTNERS. >>FOR NOW, THE WEBSITE ITSELF IS FOCUSED VERY MUCH ON THE MEN. BECAUSE HONESTLY MY GOAL IS THAT WHEN A MAN USES THE WEB SITE HE SHOULD FEEL COMFORTABLE ABOUT IT. YOU SHOULD VIEW IT IN PUBLIC, WITHOUT PEOPLE KNOWING IT’S NECESSARILY A FERTILITY WEBSITE.>>SO HOW DO YOU REACH THE PEOPLE AROUND THEN?>>SO MY VIEW IS AS FOLLOWS. I THINK THAT WOMEN ARE ALREADY SO THOUGHTFUL ABOUT FERTILITY. WOMEN ARE AT STEP FOUR. SO THEY DON’T NEED KIND OF THIS MASCULINE BRAND THAT MEN MIGHT. AND SO THEY — THEY ALREADY HAVE VERY AWARE OF THE TOPIC. THEY’LL FEEL COMFORTABLE SHARING A WEBSITE LIKE THAT WITH THEIR PARTNERS. >>IS THERE — IS THERE A SUBSCRIPTION ASPECT TO THIS BEYOND THE INITIAL SALE?>>SO I’M TESTING TWO MODELS. THE FIRST IS THE BUNDLED PACKAGE THAT IS A ONE TIME FEE. THE UNBUNDLED PACKAGE WHICH IS MORE INTERESTING BECAUSE IT HAS A MORE ACCESSIBLE PRICE POINT FOR 350 U.S. DOLLARS YOU CAN GET YOUR — YOU KNOW, YOU CAN GET YOUR ASSETS ANALYZED AND YOU HAVE THE OPTION OF FREEZING IT. THEN THAT WOULD BE A MONTHLY FEE OF ABOUT $15.>>YOU DO IT FREE — THE STORING AND THEN YOU GET –>>CORRECT. CORRECT. YEP. >>PART OF THE PROCESS DO YOU OWN AND WHAT DO YOU OUTSOURCE? THE ANALYSIS, FOR EXAMPLE, ET CETERA.>>WE OWN THE KIT, AS WELL AS THE DESIGN OF THE KIT AND THE TECHNOLOGY THAT GOES INTO IT. THE ACTUAL CLINICAL ANALYSIS IS DONE BY THE PARTNER CLINICS. WE HAVE CREATED THE LEGACY STANDARD WHICH IS A SERIES OF REGULATIONS. AND GOING BACK TO THE CORE VALUES, QUALITY IS KEY. EVEN IF SOMEONE ELSE TRIES TO COME OUT AND CREATE A SIMILAR COMPANY WHERE THERE’S A REAL RISK THAT THEY WOULD DO SO IRRESPONSIBLY. SO THE GOAL FOR US IS TO DO IT IN A VERY RESPONSIBLE WAY. SO WE PARTNER WITH CLINICS AND WITH CRYOSTORAGE FACILITIES AS WELL. I’LL ADD ONE MORE THING ON TO THAT, SOMETHING WE DO, WE DO MULTISITE STORAGE. SO WHEN A CLIENT SENDS US THE ASSETS WE DIVIDE IT INTO TWO DIFFERENT GEOGRAPHIC LOCATIONS. WITHIN EACH LOCATION WE DIVIDE THE SAMPLE INTO TWO. THEIR ASSET IS STORED IN FOUR DIFFERENT LOCATIONS. >>HOW DOES IT WORK? THE CUSTOMER ACQUISITION, YOUR COST OF GOODS SOLD? HOW DOES THIS STUFF WORK?>>SO WITHOUT GETTING TOO GRANULAR INTO THE FIGURES WE HAVE COMFORTABLE MARGINS NOW FOR 30%. WE’RE STILL FIGURING OUT WHAT THE CUSTOMER ACQUISITION COST WILL BE. IT’S NOT A ONE TIME DECISION FOR MEN. THIS SOMETHING THEY HAVE TO BE EDUCATED ABOUT, TO RAISE AWARENESS ABOUT. THAT MIGHT TAKE SEVERAL MONTH. >>ARE WE AN EDUCATION AND MARKETING COMPANY OR LIKE MORE TECH, HOW DO WE THINK OF OURSELVES?>>I WOULDN’T SEGMENT IT SO CLEARLY INTO ONE OR THE OTHER. BUT THERE’S A BIG EMPHASIS ON AWARENESS. WE ARE HELPING TO GET MEN THINKING ABOUT IT FOR FIRST TIME. THAT’S A BIG PART OF WHAT WE DO.>>WHAT MAKES THIS DEFENSIBLE LONG TERM? WHAT IS PREVENTING THE NEXT COMPANY TO TAKE OVER?>>THIS IS A QUESTION THAT I THINK ABOUT EVERY DAY.>>>MORE AGGRESSIVE MARKETING AND EVENTUALLY A COMPANY LIKE THAT IS GOING TO FAIL SPECTACULARLY. WHEN YOU ARE DEALING WITH MEN’S MOST VALUABLE ASSETS, SENSITIVE GENETIC MATERIAL, YOU CANNOT AFFORD TO CUT CORNERS. YOU CANNOT AFFORD TO BE SLOPPY. YOU HAVE TO TREAT IT CAREFULLY. THAT’S WHY THE VALUE DRIVEN APPROACH OF LEGACY, WHICH HAS BEEN DEVELOPED OVER A LONG PERIOD OF TIME, I THINK IT’S CRITICAL TO THE LONG-TERM SUCCESS OF THE COMPANY, AND I DON’T THINK THAT A COMPETITOR CAN MATCH THAT. >>SO YOU’RE GOING TO GET LEGACY.COM TO GET STARTED AND THEN HOW DO YOU CONVINCE ME THAT THIS IS MY MOST VALUABLE ASSET.>>SO IT’S NOT NECESSARILY ME WHO HAS TO DO THE CONVINCING, IT’S THE PEOPLE AROUND YOU WHO MIGHT BE SAYING, HEY, YOU KNOW, I JUST SAW AN AD FOR HYMNS, FOR HAIR LOSS, FOR LEGACY, AREN’T THESE THINGS YOU MIGHT HAVE THOUGHT ABOUT BEFORE.>>FINAL QUESTIONS?>>I JUST WANT TO SAY THAT I THINK IT’S A GREAT IDEA BASICALLY IN TERMS OF KIND OF FROM A GENDER PERSPECTIVE. YEAH, I JUST WANT TO KIND OF SAY THAT BECAUSE I DON’T KNOW IF I’LL SEE YOU AGAIN.>>I APPRECIATE THAT. OUR GOAL IS REALLY TO REBALANCE THE RESPONSIBILITIES OF FAMILY PLANNING.>>YEAH.>>AND TO HELP FAMILIES HAVE KIDS WHEN AND HOW THEY CHOOSE SO THANK YOU. >>AWESOME.>>SUPER. >>AND ON THAT NOTE, ONE MORE ROUND OF APPLAUSE FOR LEGACY.>>THANK YOU VERY MUCH.>>LET’S BRING OUT OUR NEXT FINALIST. PAULA TAYA, ARE FAROOK, AND TASIA ANTONOVA. >>CITIES PROVIDE A VAST VARIETY OF SERVICES SO THEIR CITIES ON A DAILY BASIS. ROADS AND INFRASTRUCTURE, PARKS, HEALTH. >>A MEDIUM SIZED CITY SPENDS A HUNDRED MILLION EUROS PER YEAR ON ALL OF ITS SERVICES BUT WHEN IT COMES TO DECISION MAKING, LOCAL GOVERNMENTS TAP IN THE DARK. ALTHOUGH THEY COLLECT A LOT OF DATA ABOUT THEMSELVES, IT’S NOT AVAILABLE TO THE LEADERS. THE PROBLEM IS THE DATA IS TRAPPED IN SILOS. CITIES HAVE MANY LEGACY SYSTEMS, SOMETIMES SCATTERED AROUND AEXE FILES OR ONLY EXISTS ON PAPER. IT TAKES A LOT OF TIME AND EFFORT TO AGGREGATE THAT DATA MANUALLY, AND THE MEDIUM CITY SPEEDS MORE THAN 100,000 EUROS A YEAR FOR MANUAL DATA PROCESSING. WE SOLVED THAT PROBLEM. MAYORS TREASURERS, DEPARTMENT HEADS AND CITY COLUMNISTS. WE TAKE DATA FROM ANY EXISTING LEGACY SYSTEM AND PRODUCE REPORTS AND ACTIONABLE INSIGHTS THAT GOVERNMENTS CAN USE TO REACH THEIR GOALS. THE PLATFORM IS MODULAR AND ALIGNED WITH THE CITY SERVICES, RANGING FROM CHILD CARE TO FIRE DEPARTMENTS TO INFRASTRUCTURE. LAST MONTH WE HAVE LAUNCHED OUR FIRST MODULE IN THE FIELD OF CHILD CARE. WITH ITS HELP, CITY LEADERS CAN TRACK THEIR PERFORMANCE, OPTIMIZE THEIR COSTS AND FORECAST THE DEMAND OVER THE NEXT YEARS. MIKE WANTED TO PREPARE FOR THE NEXT CITY COUNCIL SESSION. THE TOPIC IS THE CURRENT CHILD CARE SITUATION. THERE ARE MORE THAN 300,000 CHILDREN IN GERMANY THAT AREN’T ABLE TO GET A SPOT IN THE LOCAL KINDERGARTEN CURRENTLIY. HOW MANY SPOTS ARE CURRENTLY AVAILABLE? DO WE HAVE ENOUGH SPOTS NEXT YEAR, AND DO WE HAVE TO BUILD A NEW FACILITY? THOSE ARE THE QUESTIONS THAT KEEP COMING UP EACH AND EVERY SESSION. MIKE WANTS TO PREPARE FOR THAT. INSTEAD OF REQUESTING REPORTS FROM MULTIPLE DEPARTMENTS HE LOGS INTO — HE SEES THAT THE UTILIZATION RATE HAS GONE UP, LOOKING AT THE TABLE BELOW, AND NOTICES SOME OF THE FACILITIES HAVE EVEN GONE BEYOND THEIR CAPACITY. MIKE WANTS TO CHECK WHICH AREA HAS THE WORST UTILIZATION RATE. HERE ON THE MAP IN DARK BLUE, LINDENBERG CLEARLY STANDS OUT. MIKE CHECKS THE FORECAST, ALREADY NEXT YEAR, IT WILL HIT THE CRITICAL POINT WHEN DEMAND WILL EXCEED THE AVAILABLE SPOTS. AND WORSE, IN FOUR YEARS FROM NOW, THERE WILL BE AS MANY AS 230 SPOTS MISSING. TOGETHER WITH THE MAYOR, AND THE TREASURER, THEY DECIDE TO BUILD A NEW FACILITY. THIS IS HOW WE MAKE IT HAPPEN. THE DATA BREACH IS A STAND ALONE PART THAT IS INSTALLED ON THE CLIENT SERVER. WE CONNECT IT TO THE DATA BASES OF THE LEGACY SYSTEMS AND RUN QUERIES ON A DAILY BASIS. THE DATA EXISTS ONLY ON PAPER, NO PROBLEM, WE DIGITIZE IT AS A SERVICE. LOOKING AT THE COMPETITION, LEGACY SYSTEMS CAN PROVIDE ALL AUTOMATIC INTEGRATIONS. CONSULTANT DELIVERY PORTS AND BASIC START-UPS THAT CAN’T MEET EUROPEAN LOCALIZATION REQUIREMENTS. STARTING THIS YEAR, WE HAVE GENERATED 50 STRONG LEADS IN OUR PRODUCT AND THREE CITIES ARE ALREADY PAYING CUSTOMERS AND USING OUR PRODUCT. THE TECH MARKET IN EUROPE IS YOUNG AND HAS HIGH POTENTIAL. OUR PRODUCT LIES AT THE INTERSECTION OF LOCAL GOVERNMENT I.T. AND CONSULTING. THE MARKET VALUE AMOUNTS UP TO 1.6 BILLION ANNUALLY IN EUROPE. STARTING IN GERMANY, YOU WANT TO SCALE TO OTHER EUROPEAN MARKETS SOON. WE DO THAT BY RUNNING REGIONALLY DISTR DISTRIBUTED SALES TEAMS TO CONVINCE CUSTOMERS ON SITE. AND WE SCALE THROUGH POLITICAL NETWORKS AND SOCIAL PROOF. WE SUFFER AS A SERVICE BUSINESS MODEL WITH A ONE TIME SETUP FEE AND AN ANNUAL LICENSE FEE. THE SET UP FEE DEPENDS ON THE AMOUNT OF DATA BASE INTEGRATIONS AND THE ANNUAL LICENSE FEE DEPENDS ON THE NUMBER OF MODULES AND THE SIZE OF THE CITY. OUR TEAM COMBINES THE BEST OF TWO WORLDS. OUR CPO HAS MORE THAN 15 YEARS OF EXPERIENCE IN BUILDING DIGITAL PRODUCTS, AND I HAVE A PUBLIC SECTOR BACKGROUND, ADVICE TO CDU INCLUDING ANGELA MERKEL ON URBAN POLICY. WE ARE SUPPORTED BY SUCCESSFUL ENTREPRENEURS AS INVESTORS AND PUBLIC SECTOR REPRESENTATIVES AS ADVISERS. OUR VISION IS THAT ALL CITY LEADERS ACROSS EUROPE MAKE DATA AND POWER DECISIONS IMPROVING THE LIFE OF MILLIONS OF THEIR CITIZENS. CREATED A MORE EFFICIENT AND EFFECTIVE GOVERNMENT TODAY. THANK YOU VERY MUCH.>>JUDGES.>>IT’S A GREAT AND NOBLE IDEA AND DEFINITELY SOMETHING THAT NEEDS TO EXIST IN THE WORLD. AT THE SAME TIME, FEELS LIKE IT FALLS IN THE CATEGORY OF THINGS THAT GOVERNMENTS SHOULD DO BUT IN REALITY DON’T REALLY DO. HOW DO YOU CREATE AN URGENCY AND A MOMENTUM FOR BROAD MARKET TO ADOPT THIS?>>THERE’S DEFINITELY A TREND. CITIES START TO HIRE CTOs, HOWEVER IT’S STILL A MINORITY OF CITIES WHO DO THAT. SOME COUNTRIES ARE BETTER AT THAT, LIKE ESTONIA, FRANCE IS CATCHING UP BUT MANY COUNTRIES ARE STILL BEHIND. MANY CITIES, WE TARGET THE CITIES THAT ARE SMALLER SIZE. OUR MAIN CUSTOMER IS FROM 10 K TO 100K CITIZENS. THOSE CITIES USUALLY NOT COVERED BY LARGE AGENCIES THAT MIGHT DRIVE THIS INNOVATION, AND ALSO, THEY RARELY HIRE CIOs.>>SO WHEN YOU SELL TO THEM, WHAT IS THE PRODUCT THAT THEY ASK FOR FIRST? IS THERE ONE PRODUCT OR FEATURE THAT THEY ALL ARE LOOKING FOR? AND MAYBE THAT’S A GOOD ENTRY POINT. >>BASICALLY THE ENTRY POINT WE GO THROUGH IS THE AVERAGE HUNDRED THOUSAND EUROS THEY PAY CURRENTLY ON THEIR MONITOR REPORTING MEANS THEY DO IT BASICALLY HALF YEAR OR YEARLY, AND THEY ACTUALLY WANT THAT, BUT THEY CAN’T DO IT. IF THEY WOULD DO IT, IT WOULD BE 500, 600, 700,000, EUROS PER YEAR, AND THEY HAVE TO EMPLOY PEOPLE, AND THEY AUTOMATE AND HAVE A DIGITAL STATISTICIAN THAT PROVIDES THAT. BASED ON THAT, WE BASICALLY DO EDUCATING OF DAY AND POLICY DECISION MAKING AND THIS IS THE SECOND STEP. >>YOU MADE US DREAM A LITTLE BIT AS HOW THE WORLD SHOULD LOOK LIKE. IT’S A LITTLE BIT TRICKY TO MAKE IT HAPPEN, SO WHAT IS THE FORCING FUNCTION? IS THERE A COMPLIANCE COMPONENT OR SOMETHING THAT, OH, MY GOD, IF I DON’T USE THIS, I’M GOING TO LOSE MY JOB OR LIKE WHAT THE FORCING FUNCTION FOR A CITY TO START USING IT?>>I WOULD IT’S MENTALITY, SO FAR WE HAD A CONVERSATION WITH REALLY A LOT OF CLIENTS. THE MOST COME TO US AND AGREE TO WORK WITH US. HOWEVER, I THINK ONE OF THE ISSUES IS THAT THEY’RE NOT USED TO PERFORMANCE BASED DECISIONS AND DECISIONS BASED ON DATA. AND WE DEFINITELY HAVE TO EDUCATE ON THAT. THEY SEE THAT THE TREND IS THERE, AND THEY NEED TO CATCH UP. I THINK IT WILL TAKE TIME FOR SURE, SO CURRENTLY WE ARE BUILDING THE SOFTWARE FOR THAT. WE’RE BASICALLY BUILDING THAT DATA WAREHOUSE, AND DATA UTILIZATION FOR THAT. BUT TO GO NEXT STEP, IT’S DEFINITELY GOING TO TAKE TIME, EDUCATION, AND COMMUNICATION WITH THE CLIENTS. >>YOU MENTIONED WHEN YOU INSTALL, IT CAN DEPEND ON THE NUMBER OF DATA SOURCES YOU’RE INGESTING, THE INITIAL FEE, SO THAT YOU’RE LOOKING AT WHERE, M- HEY, WE HAVE INGESTED THE DATA OR THE SOURCES FROM 200 DIFFERENT CITIES. IS THERE SOME SORT OF COMPARISON ANALYSIS YOU CAN RUN, SAY, HEY, YOUR CITY IS THIS SIZE, WHAT DOES YOUR CITY LOOK LIKE COMPARED TO OTHER CITIES ITS SIZE, THAT SORT OF THING?>>YES, THAT’S DEFINITELY WHAT WE PLAN TO DO. CUSTOMERS ALREADY REQUIRED THAT. SO FAR IT REQUIRES SUDDEN DENSITY AND COVERAGE OF THE CITY’S IN THE SAME AREA, SAME SIZE, AND SAME BACKGROUND. >>SAME CURRENCY. >>CURRENCY AS WELL. LANGUAGE THAT’S DEFINITELY THE PLAN. I THINK IT WILL HAPPEN DEFINITELY THIS YEAR. WE TARGET BRAN DENBURG AS THE FIRST STATES IN GERMANY THAT WILL HAVE POLITEA, AND IF WE HAVE ENOUGH CLIENTS WE WILL LAUNCH THIS VISION. >>AND HOW DO YOU THINK ABOUT OTHER MARKETS, IS IT THE PRODUCT THAT YOU SEE WILL BE EASY TO SELL INTO OTHER GOVERNMENT STRUCTURES OR IS IT VERY LOCAL TO THE GERMAN ONE TODAY. >>ACTUALLY, IT’S VERY CRITICAL TO SELL TO OTHER STRUCTURES IN A WAY, MUNICIPALITIES ARE NOT LOOSE IN THE SYSTEM. THEY ARE CONNECT TO THE STATE AND THE COUNTIES. WE SEE THE COUNTIES AS THE NEXT LAYER BECAUSE THEY FULFILL FUNCTIONS MOBILITY IS MORE ON THE COUNTY LEVEL THAN THE MIS MUNICIPALITY LEVELS. ACTUALLY THE THREE LAYERS ARE INTERESTING. >>IT’S WONDERFUL TO SEE DATA, AT THE SAME TIME, DATA CAN BE DECEIVING, THERE MIGHT BE DATA MISING IS THERE A — MISSING IS THERE A WAY TO KIND OF HELP THE USER UNDERSTAND WHAT DATA MIGHT BE MISSING OR WHAT MIGHT THIS DATA BE SKEWED OR SCREWED OR WHATEVER THE WORD IS. >>BOTH. >>THEY START REALIZING WE HAVE LEG SYSTEMS — LEGACY SYSTEMS, USUALLY ONE PERSON OWNS THAT, AND 20 YEARS, THIS IS THE AVERAGE. MAYBE THEY REALIZE, AND WE RELY ON INFORMATION, AND WE BASICALLY DETECT IN THE BEGINNING AND ENCOURAGE OUR CLIENTS TO DO. >>IT SOUNDS LIKE YOU REQUIRE A LOT OF HUMAN ASSISTANCE. YOU NEED TO EDUCATE THEM ABOUT THE VALUE. YOU NEED TO EDUCATE THEM ABOUT MAYBE THE QUALITY OF THE DATA SO IS IT A CONSULTANT TASK OR HOW DO YOU THINK ABOUT THAT?>>IT PARTLY IS. AT LEAST CURRENTLY THAT’S WHAT WE DO AS WELL. I THINK ALSO THAT JUST BY USING THE PRODUCT AND SEEING THE VALUE AND IMPACT THAT IT HAS, THEY WILL START TREATING THEIR DATA MORE SERIOUSLY. CURRENTLY IT’S ALREADY, SOME IS MAINTAINED, THAT’S WHY WE SEE SOME OF THE PROBLEMS. WE HAVE TALKED TO THEM, AND USUALLY GOVERNMENTS ARE QUITE E IF THEY SEE SOMETHING IS WRONG WITH DATA, THEY REQUEST TO CLEAN IT UP.>>IT’S ALWAYS ENCOURAGING TO SEE A SALES FORCE ON A START UP SLIDE BECAUSE EVERYBODY IMAGINES THIS THING WILL INSTALL ITSELF. SO COULD YOU JUST SKETCH OUT THE IDEA OF THE SALES FORCE? DO YOU OWN THESE SALESPEOPLE? ARE THEY THE INSTALLERS AS WELL AND WHAT KIND OF EDUCATION THEY NEED, BASICALLY WHAT KIND OF SKILL SET DO YOU NEED TO BE ABLE TO INSTALL THIS, GET IT ON SITE. I LOOKED AT THE FLOOR AS 5K, RIGHT, TO INSTALL, AND THE CEILING IS SOMEWHERE AROUND 50K.>>THE SALESPEOPLE WE HIRE ARE FOCUSSED IN PUBLIC SECTOR. THEY HAVE AT LEAST EXPERIENCE IN THE GOVERNMENT BODY BECAUSE THE MOST IMPORTANT IS THAT YOU HAVE TO DETECT WHO’S THE DECISION MAKER AND IT’S NOT ALWAYS THE MAYOR. SOMETIMES THE MAYOR IS THE DOOR AND THEN IT’S THE HEAD OF ADMIN ADMINISTRATIVE SERVICES OR SOMETIMES TREASURY, AND YOU HAVE TO BE ABLE TO KNOW THAT OR DETECT THAT. YOU CAN ALSO HAVE WORKED IN A PUBLIC BANK, FOR EXAMPLE, THAT’S ONE OF THE SALES REPRESENTATIVES WE HAVE NOW IN THE REGION SOLD INS INSURANCE, BUT AT LEAST HE HAD CONTACT. THAT’S HOW WE RUN CURRENTLY. >>THERE’S BEEN SOME COMPANIES IN THE PAST THAT I HAVE TRIED — THAT HAVE TRIED TO DO THIS, AND WHY HAVEN’T THOSE BECOME GIGANTIC COMPANIES, IS IT A DIFFERENT MOMENT IN TIME NOW TO BUILD A BILLION DOLLAR COMPANY DOING THIS?>>I THINK EUROPE JUST BASICALLY LACKS MAYBE FIVE YEARS OR TEN — LAGS MAYBE FIVE YEARS OR TEN YEARS BEHIND THAT TREND. THAT’S WHY WE SEE A BIG OPPORTUNITY TO DRIVE IT FROM THE EUROPEAN PERSPECTIVE. WE WANT TO TARGET GERMANY FIRST BUT ACTUALLY THINKING ABOUT FRANCE, AUSTRIA, SWITZERLAND AND SO ON TO SEE IT AS A EUROPEAN PRODUCT. ENING THAT’S HOW — I THINK THAT’S HOW WE IN THAT EARLY STAGE BECOME A PLAYER. >>HOW BIG IS THE COUNTRIES YOU ARE FOCUSSED ON. >>IT IS 1.6 BILLION AND 100,000 MUNICIPALITIES IN EUROPE. >>CAN YOU GET SOME OF THESE STATES TO PUSH TO LOCAL MUNICIPALITIES. OTHERWISE, HONESTLY, ONE INSTALL ONE BY ONE SMALL ONE IS GOING TO TAKE A LONG TIME TO GET TO VELOCITY. >>WE DO THAT. WE TALKED TO ONE STATE ALREADY BECAUSE IT’S OF COURSE BETTER IF A STATE SAYS I BUY THIS FOR ALL MUNICIPALITIES, MAYBE FOR A BIT LOWER PRICE, ROLL IT UT,OUT, ANO THE FEATURES YOU MENTIONED, THE COMPARISON IMMEDIATELY.>>WE ENCOURAGE YOU TO TRY THAT.>>ABSOLUTELY.>>HOW BIG IS YOUR TEAM. YOU SEEM TO BE UP AND RUNNING ALREADY. >>EIGHT PEOPLE. >>EIGHT VERY BUSY PEOPLE.>>ANY FINAL QUESTION? ALL RIGHT. GIVE IT UP FOR POLITEA. WE HAVE ONE LAST FINALIST. THAT FINALIST IS SPIKE, PRESENTING FOR SPIKE ARE ZIOD ALMAN AND MICHELLE RAJGE.>>I WILL LIVE EIGHT YEARS LESS THAN YOU. IT’S BECAUSE I’M DIABETIC. DIABETES IS AN INCURABLE DISEASE THAT AFFECTS A PERSON’S ABILITY TO PRODUCE OR REACT TO INSULIN. ENSH ENSLAVING US TO A LIFE OF BLOOD SUGAR MANAGEMENT AND INSULIN INJECTIONS, LIKE THIS ONE OR THIS ONE. EVER SINCE MY DIAGNOSIS A DECADE AGO, I HAVE INJECTED MYSELF WITH MORE THAN 30,000 INSULIN INJECTIONS. BUT THAT WASN’T ENOUGH. YOU SEE, THE PROBLEM IS I MISSED MORE THAN 3,000 OTHER INJECTIONS AND MISCALCULATED MORE THAN 6,000 DOSAGES. LIVING WITH DIABETIC IS INCREDIBLY DIFFICULT BECAUSE EVERYTHING AFFECTS MY SUGAR, FROM FOOD, ACTIVITY, MEDICATION, THE STRESS AND EVEN THE WEATHER. AND ALTHOUGH THERE ARE HUNDREDS OF APPS ON THE STORE THAT WANT TO HELP DIABETICS LIVE BETTER, YET ALL THEY DO IS PROVIDE US WITH FANCY TOOLS SO THAT WE CAN DO HARD WORK OF LOGGING DETAILS AND THEN MANUALLY ANALYZING THEM OR SHARING THEM. WHY CAN’T IT BE AS EASY AS WHEN YOU HAVE A SCHEDULED TRIP AND GOOGLE MAPS WILL TELL YOU, YOU NEED TO MOVE FIVE MINUTES EARLIER BECAUSE THERE’S TRAFFIC. INTRODUCING TO YOU SPIKE. THE SMARTEST DIABETES ASSISTANT IN THE WORLD. BY AUTOMATICALLY COLLECTING DETAILS ABOUT YOUR LIFE, YOUR ACTIVITY, AND YOUR VITALS, SPIKE PROACTIVELY PROVIDES YOU WITH THE RIGHT INSULIN TIPS AND REMINDERS, WITH FOOD SUGGESTION. LET’S JUMP OVER TO THE DEMO TO SEE HOW OUR DIABETIC MICHELLE BENEFITS FROM SPIKE. MICHELLE HAS BEEN STRESSING OUT ABOUT THE PITCH, AND FROM DETECTING HER ACTIVITY AND HER STRESS LEVELS THROUGH HER HEART RATE, SPIKE ALERTS HER TO CHECK HER SUGAR BECAUSE SHE MIGHT BE GOING THROUGH HIGD SPIKE WOULD AUTOMATICALLY GET A READING THAT WOULD TELL US 56, THAT’S QUITE LOW. I THINK MICHELLE SHOULD HAVE SOME SUGAR. BUT THAT VERIFIES THAT SHE IS GOING THROUGH HYPOGLYCEMIA, SHE CAN COMPARE TO TO THIS INSULIN AND DEPENDING ON HOW MANY DEVICES SHE HAS CONNECTED. WITH TECH LAUNCH, WE ADDED A SPIKE FOR TECH LAUNCH WHICH WOULD IMAGE MICHELLE’S ACTIVITY OF GOING TO MCDONALD’S. AS SOON AS SHE WOULD ENTER MCDONALD’S, SHE WOULD AUTOMATICALLY GET THE TOP THREE FOOD OPTIONS WITH APPROXIMATE CARB COUNT. THERE’S A POST MEAL INSULIN INJECTION OR SHE WOULD BE PART OF THE 90 BILLION LOSS OF PRODUCTIVITY FROM DIABETICS IN THE U.S. ONLY. SO SHE GOT A POST MEAL INSULIN INJECTION AND WILL TAKE HER INSULIN OR SUGAR IN THIS CASE. LET’S GO BACK TO THE PRESENTATION. AS FOR HER GUARDIANS AND DOCTORS, THEY ARE INFORMED IN REALTIME ABOUT HER SITUATION, BUT THEY ARE ALSO ALERTED IF UNUSUAL PATTERN IS DETECTED OR SOMETHING IS WRONG. TODAY THERE ARE MORE THAN 2,500 DAILY ACTIVE DIABETICS LOVING SPIKE. 87% OF THEM TRANSFERRED FROM OTHER APPS TO USE IT. EVER SINCE WE STARTED ONE YEAR AGO, TWO WEEKS AND ONE DAY, WE HAVE BEEN SUPPORTED BY MORE THAN 10 INTERNATIONAL ORGANIZATIONS AND INSTITUTIONS AND WE HAVE BEEN FUNDED AS WELL WITH APPROXIMATELY $250,000. NOT JUST THAT, WE ARE PROUD TO HAVE COLLEGE HOSPITAL OF LONDON AS OUR MEDICAL AND RESEARCH PARTNER. WHICH LED TO SIGNING A COMMERCIAL DEAL WITH MEDTRONIC, AND THEN THE TIP OF THE ICEBERG, SANOFI HAS PARTED WITH US AFTER THEY SAW THE IMPACT WE HAD ON DIABETICS AND THE WAY THEY USE THEIR INSULIN. NOW, TO THE THINGS I MISSED, WHAT MAKES US DIFFERENT FROM ALL THE OTHER APPS IS THAT FROM A DIABETICS PERSPECTIVE, WE UNDERSTOOD THAT THE PROBLEM LIES BEFORE THE INCIDENT HAPPENS, NOT AFTER IT, AND THIS IS WHY WE EXPERIENCE DIFFERENTLY, AND THIS IS WHY DIABETICS LOVE US. WE CHANGED IT FROM MORE WORK TO LESS WORRY, AND FOR DIABETICS, IT’S NOT JUST HARD TO LIVE WITH DIA DIABETES, IT’S ALSO EXTREMELY EXPENSIVE. DON’T WORRY, SPIKE IS FREE FOREVER FOR DIABETICS. WE FOUND OUT WHO ARE THE PEOPLE WHO CARE ABOUT YOUR HEALTH MORE THAN YOU AND ARE WILLING TO PAY FOR IT, AND THEY ARE INSURANCE COMPANIES, SELF-INSURED EMPLOYERS AND MANY OTHERS WHO WANT TO ENHANCE YOUR PRODUCTIVE. BEHIND SPIKE IS A TEAM OF PASSIONATE DIABETICS, ENGINEERS AND NUTRITIONISTS WHO HAVE MORE THAN 13 PARTNERS IN THE BIOMEDIC FIELD AND MORE THAN FOUR PAPERS IN COMPUTER VISION AND A.I. NOT JUST THAT, MY TEAM ENJOYS EVERY MOMENT IN THEIR LIFE BECAUSE WE KNOW THAT IF DIABETES HAPPENS, YOU WILL LIVE EIGHT YEARS LESS, SO WE HAVE FUN EVERY DAY. NOW, BY THE TIME I’VE TOLD YOU ABOUT SPIKE, 24 PEOPLE DIED FROM DIABETES. 16 OF THEM DIED BECAUSE THEY DIDN’T MANAGE IT PROPERLY. SPIKE COULD HAVE SAVED THEM BY DOING WHAT IT DOES BEST, MAKING DIABETES MANAGEMENT LESS DIABETIC. THANK YOU.>>JUDGES?>>I KNOW YOU TWO INVESTED IN SOMETHING SIMILAR. >>WE LOVE IT. >>52.5 MILLION. >>IT’S A GOOD COMPANY. >>IT IS. I LOVE THEM. LET’S TALK A LITTLE BIT ABOUT THAT. HOW DO WE MAKE SURE WE’RE NOT JUST ANOTHER APP FOR DIABETES CONSUMERS SO THAT, YOU KNOW, INDEED, YOU KNOW, WE TRULY MAKE SURE THAT THE WORK FLOW OF A DIABETES CONSUMER BECOMES A PIECE OF CAKE AND THEY LOVE IT SO MUCH THAT THEY USE IT ALL THE TIME. >>ABSOLUTELY. >>HAVE YOU PROVEN THAT? WHAT IS IT?>>YOU KNOW YOU LOVE SOMETHING WHEN IT’S MAGICAL, CORRECT? AND WHAT’S MAGICAL IS WHEN SOMETHING HAPPENS WITHOUT YOU EVEN DOING ANYTHING, AND THIS IS WHAT HAPPENS HERE. NOW, LEVONGO OR OTHER PLAYERS TRYING TO HELP DIABETICS, THEY START WITH A CARE PROGRAM OF THREE MONTHS. I HAVE BEEN THROUGH THE CARE PROGRAM, MICHELLE HAS AS WELL. THAT THREE MONTH PROGRAM ISN’T ENOUGH. WHAT HAPPENS AFTER THAT THREE MONTHS, YOU HAVE — YOU SPEND LESS TIME WITH DOCTORS. IF A CARE GIVER CALLS ME EVERY TIME I HAVE A HYPER OR HYPO, I WILL NEVER PICK UP MY PHONE AGAIN. THAT HAPPENED ON STAGE WITH NEVONGO, THE CARE GIVER CALLED AND THEY WERE LIKE, YEAH, YEAH, I KNOW WHAT TO DO, THANK YOU SO MUCH, I’M ON STAGE, AND THEY HUNG UP. IT’S INTERESTING TO HAVE SOMEONE CALL YOU BUT REALLY YOUR CARE TEAM IS YOUR CLOSE FRIENDS AND FAMILY, AND THEY ARE THE ONES WHO WOULD HELP YOU. AND TO DO THAT, WHAT WE DO AT SPIKE IS YOU DON’T ONLY GET A REMINDER FOR YOUR POST INSULIN. IF I WAS WITH MICHELLE AT MCDONALD’S, AND I’M PART OF HER CARE TEAM, SPIKE WOULD AUTOMATICALLY TELL ME, ZIOD PLEASE CHECK WITH MICHELLE IF SHE TOOK HER INSULIN, AND THAT’S EXTREMELY IMPORTANT. I THINK THOSE ARE TWO MAJOR POINTS AND THERE’S ALWAYS A WAY TO PLUG WITH OTHER COMPANIES, ESPECIALLY SINCE THEY HANDLED WITH THE DIABETIC IS DIAGNOSED OR START TAKING CARE OF THEMSELVES. WE CAN COME LATER ON AFTER THAT PROGRAM. >>I HAVE A QUESTION, CAN YOU AGGREGATE, I TRACK MY SLEEP AND I USE CLUE, AND I HAVE A TRAINING APP, SO I COLLECT A LOT OF DATA. CAN YOU GET THAT INTO THE APP SO YOU CAN PREDICT MY BEHAVIOR OR IS IT ONLY BASED ON DATA THAT I ENTER INTO SPIKE?>>HERE’S THE VERY INTERESTING PART. YOU DON’T ENTER DATA INTO SPIKE. IT CONNECTS IT FROM YOUR SENSORS, WEARABLES, PEOPLE WILL NOT USE AN APP THEY HAVE TO OPEN EVERY TIME AND INPUT DATA. AT SPIKE, 2,500 DIABETICS HAVE CROSSED THE 14 DAY PERIOD, WHICH USUALLY, PEOPLE LOSE INTEREST AND STOP INPUTTING DATA FOR TWO DAYS, THEY FEORGET ABOUT THE WORK. PEOPLE HAVE STAYED ON SPIKE FOR MONTHS. PEOPLE HAVE BEEN TELL EACH OTHER ABOUT SPIKE. LOOK HOW EASY IT IS TO USE, AND MOST OF OUR USERS ARE IN EUROPE. YOU CAN INPUT PREVIOUS DATA AND THAT MIGHT HELP US A LOT, AND YOU CAN EXPORT DATA. >>SINCE IT’S LITERALLY A MATTER OF LIFE AND DEATH, HOW DO YOU THINK ABOUT LIABILITY, RESPONSIBILITY, MAKING THE WRONG RECOMMENDATION?>>ABSOLUTELY. IT IS A MATTER OF LIFE AND DEATH, AND TODAY IT’S A MATTER OF DEATH. IF WE CAN ADD 1% OF CHANCES TO LIVE BETTER WE WILL TAKE THAT RISK. BUT IT’S NOT A RISK BECAUSE WHAT WE DO IS WE SUGGEST TO YOU THINGS THAT ARE NOT MEDICAL. IT’S NOT PRESCRIP TIVE, ELEVATE HEART RATE, CHECK YOUR BLOOD SUGAR. YOU MIGHT BE HYPOGLYCEMIC. IT IS VERY IMPORTANT. WE DO SOMETHING SPECIAL. WE’RE WORKING WITH A PSYCHOLOGIST ON UNDERSTANDING HOW PEOPLE ACCEPT SUGGESTIONS AND TIPS. SO DEPENDENT ON HOW OLD YOU ARE AND WHERE YOU COME FROM IN THIS WORLD, YOU WOULD GET A DIFFERENT TYPE OF MESSAGE. SO THAT WE CAN BETTER ADDRESS YOU. BUT THERE IS NOTHING LIKE, IF I TELL YOU CHECK YOUR SUGAR, THAT WON’T CAUSE SPIKE TO BE TELLING YOU TO DIE, AND IF YOU GET CARB COUNT, THEN YOU’RE THE ONE WHO’S TAKING THE INSULIN, SO IT’S JUST BEING THERE, PROVIDING YOU WITH THAT EXTRA STEP TO LIVE BETTER.>>CAN I ASK A LITTLE BIT ABOUT HOW YOU DO USER RESEARCH OR HOW YOU TALK TO YOUR USERS ABOUT WHAT THEY WANT?>>ABSOLUTELY. SO I’M DIABETIC. SHE’S DIABETIC. AND WE’RE CONSTANTLY IN CALLS WITH OUR DIABETICS. SO I’LL START WITH THIS STORY, AND THEN I’LL TELL YOU HOW WE TALK TO THEM. I WANTED TO TEST IF SPIKE REALLY MATTERS. I STARTED AS A PERSONAL PROJECT. FIRST I LEFT BEING THE CEO OF A LARGE CROWD FUNDING COMPANY, AND WANTED TO BUILD SOMETHING AFTER PASSING THROUGH TOUGH TIMES, AND AFTER BUILDING SPIKE, I SAID HOW WOULD THAT MAKE A DIFFERENCE, SO I DELETED THE APP, AND E THE NE DAY I WAS OUT WITH FRIENDS AND I FORGOT TO TAKE INSULIN AFTER HAVING SOME FOOD, AND AFTER TWO HOURS, I WAS LIKE, OOPS, DIDN’T TAKE MY INSULIN, HAVING HYPERGLYCEMIA, AND THAT’S THE MOMENT I REALIZE I NEED THIS APP. IT’S NOT I WANT IT. IT’S I NEED IT. WE DON’T TALK TO OUR DIABETICS. IT’S HAPPENING THE OTHER WAY AROUND. EVERY DAY, I HAVE MORE THAN AT LEAST FIVE E-MAILS OF FUTURE REQUESTS, DEVICES TO SUPPORT, SO THIS IS ONE OF THE DEVICES WE SUPPORT. BY SUPPORTING THIS DEVICE, PEOPLE NO LONGER NEED TO CARRY THIS. IMAGINE, YOU WERE CARRYING A DEVICE, NOW IT’S JUST THROUGH YOUR PHONE. WE CONSTANTLY SIT WITH OUR RESEARCH PARTNERS TO UNDERSTAND MORE OF THE NUMBERS THEY HAVE. WE LISTEN TO EACH AND EVERY DIABETIC, AND WE LISTEN TO PEOPLE WHO LEAVE OUR PLATFORM. LESS THAN 3% OF THE PEOPLE WHO JOINED SPIKE LEFT, AND IT’S BECAUSE PART OF THEM WEREN’T DIABETICS, THEY DOWNLOADED IT OUT OF CURIOSITY, AND AN APP I DON’T DO ANYTHING WITH, HOW WOULD I USE THAT. BUT THE OTHER PARTS, THEY WERE JUST — THERE WAS A LANGUAGE BARRIER, SO WE’RE PLANNING ON HAVING SPIKE IN MULTIPLE LANGUAGES, BESIDES THAT, THE SATISFACTION AND THE REFERRALS, TOP OF THE ROOF. >>HOW DO USERS USE THE APP, WHAT KIND OF BEHAVIOR HAVE YOU NOTICED SO FAR?>>OKAY. SO THERE IS ONE, THE ACTUAL LOGGING WITH A GLUCOMETER. SOME DON’T DO IT AUTOMATICALLY, YOU WOULD HAVE TO DO IT MANUALLY. THOSE 2,500 ACTIVE USERS HAVE LOGGED THEIR DIABETES INPUTS INTO THE APP EVERY SINGLE DAY. BESIDES THAT, THERE’S ALSO THE FOOD SUGGESTIONS, WHERE YOU CAN SEE MORE TIPS WITHIN THE APP. SO MANY PEOPLE HAVE BEEN CLICKING ON THOSE TIPS AS WELL. AND MOSTLY, IF IT WAS UP TO ME, I WOULDN’T WANT ANYONE TO OPEN THE APP IF IT WAS UP TO ME, BUT THIS IS THE KIND OF TWO MAJOR THINGS. >>SO FOOD AND REGARDING INJECTIONS. >>FOOD, OPENING THE APP TO VIEW MORE FOOD OPTIONS AND INPUTTING THEIR GLUCOSE LEVEL DATA.>>HOW DO WE MAKE MONEY?>>HOW DO WE?>>MAKE MONEY.>>SO THERE ARE MANY WAYS THAT WE ARE LOOKING AT TO MAKE MONEY. ONE OF THEM IS IT’S A PREMIUM MODEL. SO YOU CAN SUPER CHARGE THE APP WITH PREMIUM FEATURES IF YOU WANT TO CONNECT MORE THAN ONE DEVICE, YOU PAY FOR THAT. BUT WE SELL THAT PREMIUM PACKAGE TO INSURANCE COMPANIES AND EMPLOYERS WHO WANT TO ENHANCE THEIR EMPLOYEES PRODUCTIVITY. THAT’S ONE. TWO, THERE’S INSURANCE DISCRIMINATION IN THE WORLD. I COME FROM A THIRD WORLD COUNTRY WHERE I HAVE TO PAY MORE THAN THREE TIMES THE AVERAGE RATE, BUT IF THAT INSURANCE COMPANY COULD REPORT AFTER MY CONSENT ABOUT MY DIABETIC LIFE, AND THEY WOULD SEE I’M A GOOD INVESTMENT, THEY CAN GIVE ME A BETTER RATE THAT COMPETES WITH OTHER INSURERS. THAT’S NUMBER TWO. BRAND ASSOCIATION WITH PHARMACEUTICALS, THERE ARE A MILLION WAYS IF YOU’RE SAVING PEOPLE TO MAKE MONEY. THOSE ARE THE TOP THREE FOR NOW.>>FOR INSURANCE COMPANIES IS YOUR PITCH TO THEM, DEMONSTRABLE REDUCTION IN IMPROPER INJECTIONS AND MISINJECTIONS?>>SO WE HAVE DONE A 1 C TESTS FOR THE PAST SIX MONTHS. IT’S A REDUCTION OF .6. THAT’S REMARKABLE IN SIX MONTHS SO THIS IS WHAT YOU SHOW THEM. YOU SHOW PEOPLE ARE ADHERING MORE TO THEIR MEDICATION, AND ALSO GETTING BETTER RESULTS FOR YOU, LIVING BETTER, DECREASING COMPLICATION COSTS. IT’S ONLY BEEN A SHORT TIME, BUT WITH TIME WE’LL BE ABLE TO HAVE A MORE SOLID STAND, AND AS WE SUPPORT MORE TECHNOLOGIES, WE’LL BE ABLE TO GO. WE ARE IN TALKS WITH ONE INSURANCE COMPANY FOR THAT. >>.>>ALL RIGHT. GIVE IT UP FOR SPIKE. >>THANK YOU.>>GREAT STORY. THANK YOU.>>THAT MEANS IT IS THE END OF THE START UP BATTLEFIELD FINALS, THANK YOU FOR BEING ATTENTIVE AND SUPPORTIVE TO THE START UPS, THE JUDGES ARE GOING TO FOLLOW ME BACKSTAGE AND CHOOSE A WINNER: LET’S HEAR IT FOR THE AWESOME JUDGES. >>LAST TIME WE WERE HERE IT WAS IN THE WINTER AND THIS TIME IT’S THE SUMMER. WE’RE HERE TO CHECK OUT THE SWEET COMPANIES. >>>IT’S BREAK TIME, WE’RE GOING TO BREAK, 15 MINUTES, SEE YOU SOON.>>>WE BUILD DIAGNOSTIC MENSTRUAL PADS IN EARLY DIAGNOSTICS FOR WOMEN. BASICALLY A MENSTRUAL PAD THAT COLLECTS A SPECIFIC VOLUME OF BLOOD. WHAT WE FOUND IS THERE IS A LOT OF BIOMARKERS IN MENSTRUAL BLOOD THAT TELLS YOU A LOT OF THINGS ABOUT YOUR HEALTH. WE HAVE TWO GROUPS OF WOMEN. THERE WAS A WOMAN INTERESTED IN LEARNING MORE ABOUT HER HEALTH OR SHE HAD A SPECIFIC LIFESTYLE. LET’S SAY SHE’S A VE VEGAN. THAT’S ONE GROUP. THERE’S ANOTHER GROUP OF WOMEN WHO HAVE A CONDITION THAT, A CHRONIC CONDITION THAT REQUIRES THEM TO GO IN AND GET BLOOD DRAWS OFTEN AND FOR THEM, THIS IS A PRODUCT THAT IS VERY USEFUL, HOPEFULLY HELPS THEIR LIFE QUALITY TO BE IMPROVED.>>>LOOK, IT’S ANDREW. GRAND KIDS ON DEMAND. >>LET’S TALK ABOUT IT. >>LET’S DO IT. >>WE CONNECT COLLEGE STUDENTS TO SENIORS, WE TEACH THEM TO USE COMMUTERS LIKE SOCIAL MEDIA AND FACE TIME THEIR GRANDCHILDREN. DRIVE THEM TO THE DOCTORS OFFICE, AND MOST IMPORTANTLY WE’RE PROVIDING A SOCIAL EXPERIENCE. WE MAKE IT EASY FOR ANYONE TO ACCESS IT. SENIORS OR FAMILIES CAN CALL US, USE OUR MOBILE APP OR THEY COULD TEXT OR E-MAIL US OR GO TO OUR WEB SITE AND REQUEST A STUDENT. WE CALL THEM PAPA PALS, IT PROVIDES FOLLOW UP INFORMATION TO ANYONE INTERESTED LIKE THE FAMILY, FRIENDS OR OTHER MEMBERS OF THE CARE TEAM. WE LAUNCHED IN JANUARY IN SOUTH FLORIDA AND IT HAS BEEN GROWING RAPIDLY. IT’S NICE TO KNOW THAT WE’RE HELPING A LOT OF PEOPLE.>>DAY ONE COMPLETE. AND NOW I’M OUT OF HERE.>>>HOW ARE YOU? HOW WAS YOUR SUMMER?>>SUMMER WAS EVENTFUL. HAD A BABY. >>CONGRATULATIONS, I HAD A BABY ALSO. BACK TO WORK. LAST TIME I WAS HERE FOUR MONTHS AGO, WINNER BATCH.>>WINNER BATCH. >>AND NOW IT’S SUMMER BATCH. ARE WE NOTICED TRENDS BETWEEN THAT ONE AND THIS ONE?>>KRYOU KNOW, I WAS TALKING TO INVESTORS YESTERDAY, AND THEY ARE NOTICING A TREND AMONGST FOUNDERS WHICH I PICKED UP ON AS WELL. I THINK AS THE NEXT GENERATION OF FOUNDERS COMING THROUGH THEY KNOW THAT THEY’RE GOING TO HAVE TO DEVOTE 10 TO 15 TO THEIR START UP. THEY’RE CONSCIOUS, WILL THEY DO WELL IN THE WORLD. ONE INVESTOR SAID I FOUND MYSELF RO ROOTING FOR THESE COMPANIES. I FOUND MYSELF THINKING I WANT THESE FOLKS TO WIN. AND IN A WEIRD WAY, WE’RE LIKE IN THE OLD DAYS, LIKE A BUSINESS WINNING, YOU DON’T REALLY ASSOCIATE WITH LIKE, WHAT EVER, BUT HERE IT’S LIKE A BUSINESS WINNING A BUNCH OF PEOPLE GETTING CHILD CARE BENEFITS OR CURING CANCER OR A BUSINESS WINNING IS, YOU KNOW, HELPING PEOPLE PAY FOR STUDENT LOANS. IT’S KIND OF A DIFFERENT VIBE, WHICH IS REALLY NICE.>>DEFINITELY.>>THAT’S BEEN A COOL NEW THEME, AND I’LL TELL YOU WHAT. IT’S FOUNDER LIGHT. LIKE WHY SHE DOES HAVE TOO MANY THESES, WE WANT TO GO WHERE OUR FOUNDERS ARE INTERESTED. SO IT’S FUN TO SEE THE FOUNDERS CARING ABOUT MAKING THE WORLD A BETTER PLACE. >>COOL. I’M GOING TO GO INTO A LITTLE BIT OF A, IF IT’S OKAY WITH YOU, A HARDER QUESTION.>>HIT ME. POUND ME.>>READY.>>IN THIS BATCH, NOTICE THERE WAS A LOT OF LIKE, BIOCOMPANIES, A LOT OF CRYPTO COMPANIES, AND IN THE PAST THERE’S BEEN CRYPTO COMPANIES ENDED UP BEING, KIND OF, AND THERE’S ALSO BEEN THE WHOLE THERNOS THING. HOW DO YOU GUYS WITH 150 COMPANIES, EVERY BATCH, DO THE DUE DILIGENCE TO MAKE SURE THESE COMPANIES ARE LEGIT ON BOTH SIDES BUT THEN ALSO WHAT RESPONSIBILITY DO YOU THINK YOU TAKE IN DOING THAT BECAUSE ALMOST WHY IT’S VIEWED AS A STANDARD BARRIER. ONCE YOU GET THROUGH THIS, LET’S TALK ABOUT THAT.>>I THINK THAT IF YOU LOOK AT THE CRYPTO COMPANIES. >>LAST QUESTION.>>WHAT’S UP?>>THIS ONE IS THE BATCH IS DONE.>>BOOM.>>>LADIES AND GENTLEMEN PLEASE WELCOME BACK TO THE STAGE TECH CRUNCH EDITOR, AND DISRUPT MC, JORDAN CROOK.>>HEY, HEY, HEY. OKAY, WE’RE GOING TO GET BACK INTO OUR REGULARLY SCHEDULED PROGRAMMING. WE’RE GOING TO BE TALKING ABOUT WHETHER OR NOT STARLING CAN BECOME THE NEXT HSBC. PLEASE WELCOME TO THE STAGE FROM STARLING, ANNE BODEN AND YOUR MODERATOR, RAMON DELAY.>>ALL RIGHT. I’M VERY HAPPY TO HAVE YOU ON STAGE. YOU’RE WORKING FOR STARLING AND YOU’RE ONE OF THE ENEMIES BECAUSE YOU WORKED

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